Import and Export Prices Unexpectedly Dive

-edited

Headline price inflation numbers on imports and exports both came in well below consensus estimates.

Let's investigate the BLS Import and Export Price Indexes for January 2019.

Imports Month-Over-Month and Year-Over-Year

Imports: Prices for U.S. imports declined 0.5 percent in January and 3.1 percent over the last 3 months. The 3-month drop was the largest decrease since the index fell 3.1 percent from July 2015 to October 2015. Import prices decreased 1.7 percent over the past 12 months, the largest over-the-year decline since the index fell 2.2 percent in August 2016.

Fuel Imports: Import fuel prices decreased 3.2 percent in January and 22.5 percent over the past 3 months, the largest drop over a 3-month period since the index fell 29.2 percent for the 3 months ended in February 2016. The January drop was primarily driven by a 44.2-percent drop in natural gas prices; petroleum prices edged down 0.1 percent. The decline in natural gas prices followed a 138.8-percent increase over the fourth quarter of 2018. Fuel prices decreased 14.4 percent over the past year. A 14.5-percent drop in petroleum prices and a 20.0-percent decline in prices for natural gas each contributed to the overall decrease in fuel prices from January 2018 to January 2019.

All Imports Excluding Fuel: The price index for nonfuel imports fell 0.2 percent in January. The January decrease was led by falling prices for nonfuel industrial supplies and materials; consumer goods; automotive vehicles; and foods, feeds, and beverages which more than offset higher prices for capital goods. Import prices excluding fuel also declined 0.2 percent over the past year.

Exports Month-Over-Month and Year-Over-Year

Exports: Prices for U.S. exports decreased 0.6 percent in January, after falling 0.6 percent in December and 0.8 percent in November. Export prices have only recorded one monthly advance since June. In January, both nonagricultural prices and agricultural prices contributed to the decline. The price index for overall exports decreased 0.2 percent for the year ended in January, the first 12-month decline since the index fell 0.2 percent in November 2016.

Agricultural Exports: Agricultural export prices declined 2.1 percent in January, the largest monthly decrease since the index fell 5.2 percent in July. The January drop followed increases of 3.8 percent in December and 1.7 percent in November. A 34.6-percent fall in export vegetable prices drove the January decline in agricultural prices. Despite the January drop, export agricultural prices advanced 0.2 percent over the past year.

All Exports Excluding Agriculture: The price index for nonagricultural exports declined 0.3 percent in January, after falling 1.1 percent in December and 1.0 percent in November. Decreasing prices for nonagricultural industrial supplies and materials and consumer goods more than offset higher prices for capital goods and automotive vehicles. Prices for nonagricultural exports fell 0.2 percent from January 2018 to January 2019, the first decrease over a 12-month period since the index declined 0.2 percent in November 2016. The drop over the past 12 months was driven by a 2.4-percent decrease in nonagricultural industrial supplies and materials prices.

Import and Export Prices 2004-Present

Expectations

  • Econoday Economists expected import prices would remain steady. Instead, they fell 0.5%
  • Econoday Economists expected export prices would remain rise 0.1%.Instead, they fell 0.6%

Economists are on a particularly bad run lately blowing

  1. Import and export prices
  2. Retail sales estimates: Shockingly Weak Retail Sales: Down 1.2% in December, Sharpest Decline Since 2009
  3. Industrial Production: Industrial Production Dives, Wiping Out a Strong December and Then Some

Mike "Mish" Shedlock

Comments
No. 1-2
Stuki
Stuki

Time to steal another pile of money, via debasement, from productive people doing productive jobs, and hand it to the usual gaggle of privileged, government apologist, nothings. Of course the latter no longer spends almost anything, since they already have two hundred of everything they could possibly want. So, no increased demand from doing that....

But hand them the privileged twits enough loot, and they'll get to the point where they have soo much loot, that they can, with their pocket change, start bidding productive people away from productive work, and productive businesses out of affordable rental contracts. So that those once productive, can now massage nitwits and serially replace the nitwits' kitchen counters; instead of wasting time doing anything productive anymore. While idle "property owners" can collect rent from massage parlors where the privileged get massages, Instead of bothering with such pesky, frugal nuisances, as those trying to make ends meet selling something productive in a competitive market.

And then, everyone can be happy, because wages are "up," "employment" is "up" and poppeti vaijues are, again, "creating sooo much wealth" as it sits there decaying....

Dagny
Dagny

Deflation Please! I just love a discount.