October 23, 2013 / 12:56 PM / 4 years ago

UPDATE 2-U.S. import prices rise, but trend remains muted

* Import prices rise 0.2 percent on petroleum
    * Prices fall 1.0 percent from a year-ago
    * Export prices up for the first time since February


    By Lucia Mutikani
    WASHINGTON, Oct 23 (Reuters) - U.S. import prices rose for
the second straight month in September as the cost of petroleum
increased, but there was no sign of a build-up in imported
inflation pressures.
    Import prices rose 0.2 percent last month after a revised
0.2 percent gain in August, the Labor Department said on
Wednesday. Import prices had previously been reported as being
flat in August. 
    Economists polled by Reuters had expected prices would gain
0.2 percent in September. In the 12 months through September,
import prices fell 1.0 percent. This likely reflects U.S. dollar
strength earlier in the year.
    "Underlying inflationary pressures are limited in the U.S.
and no risks of inflation spikes at the final stages of the
price formation chain are expected anytime soon," said Annalisa
Piazza, an economist at Newedge Strategy in New York.
    Import prices excluding petroleum were flat from August.
Compared to September last year, they fell 1.0 percent, the
largest drop since November 2009.
    The report was originally scheduled for release on Oct. 10
but was delayed after the federal government was partially shut
down because of a fight over the budget. The 16-day shutdown
ended last Wednesday.
    The government will release September wholesale and consumer
inflation reports next week.
     
    
    
    NO INFLATION PRESSURES
    The general lack of imported inflation pressures against the
backdrop of weak global demand and commodity prices should help
the Federal Reserve to maintain its monthly bond purchasing
program into early next year as it tries to nurse a lackluster
economy back to health.
    Domestic inflation is also muted and will likely stay that
way for a while as demand remains tepid.
    "The Fed has little to fear about inflation," said Joel
Naroff, chief economist at Naroff Economic Advisors in Holland, 
Pennsylvania. "It is likely that quantitative easing will
continue into next year."
    Last month, imported petroleum prices rose 0.8 percent after
rising by a revised 1.9 percent in August. Imported food prices
advanced 0.5 percent after increasing 0.3 percent the prior
month.
    Elsewhere, imported capital goods prices were unchanged from
August, as were prices for motor vehicles. Automobile prices
fell 1.2 percent from a year ago, the largest year-over-year
decline since records began in June 1981.
    The Labor Department report also showed export prices rose
in September for the first time in seven months, posting a 0.3
percent gain. Export prices had dropped 0.5 percent in August.
    Export prices were lifted by agricultural goods, where
prices rose 0.7 percent after steep declines the prior month.
While agricultural export prices rose last month, they fell 6.3
percent from a year-ago. That was the largest year-over-year
decline since October 2009.
    Prices for exported industrial supplies and materials rose
0.7 percent from August. There were also increases in the price
of exported fuels, which advanced 0.7 percent. Exported capital
goods prices rose marginally, while autos were flat.

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