US import prices rise strongly in February, boosted by crude oil, commodities

WASHINGTON: US import prices increased strongly in February, boosted by higher costs for crude oil and commodities, strengthening expectations for an acceleration in inflation this year.

The Labor Department said on Tuesday import prices rose 1.3% last month after surging 1.4% in January. Economists polled by Reuters had forecast import prices, which exclude tariffs, advancing 1.2% in February.

In the 12 months through February, import prices accelerated 3.0%. That was the largest gain since March 2012 and followed a 1.0% rise in January.

Oil prices have recovered to pre-pandemic levels amid expectations of a pick-up global economic growth, but the COVID-19 pandemic is caused disruptions to the supply chain, boosting prices of commodities.

Inflation is expected to gain steam this year, driven by massive fiscal stimulus and the reopening of the domestic economy as vaccinations slow the spread of the coronavirus. But excess capacity in the labor market will probably stop price pressures from spiraling out of control.

Imported fuel prices surged 11.1% last month after advancing 9.0% in January. Imported food prices shot up 1.6%.

Excluding fuel and food, import prices climbed 0.3%. The so-called core import prices rose 0.9% in January.

Last month, the cost of goods imported from China rose 0.3% after gaining 0.2% in January. Prices for imported capital goods ticked up 0.1%. The cost of imported motor vehicles gained 0.1%. Prices for consumer goods excluding autos edged up 0.1%.

The report also showed export prices rose 1.6% in February after increasing 2.5% in January. Prices for agricultural exports rose 2.9%, while nonagricultural exports increased 1.5%.

Export prices jumped 5.2% on a year-on-year basis in February, the largest gain since June 2018, after rising 2.3% in January.