November 2019 Import and Export Price Year-over-Year Inflation Now -1.3% Year-over-Year

Written by Steven Hansen

Year-over-year import and export price indicies remain in contraction year-over-year.

Import Oil prices were up 2.6 % month-over-month, and export agricultural prices were up 2.2 %.

• the markets were expecting (from Econoday):

There is only a marginal correlation between economic activity, recessions, and export/import prices. Prices can be rising or falling going into a recession or entering a period of expansion. Econintersect follows this data series to adjust economic activity for the effects of inflation where there are clear relationships.

Econintersect follows this series to adjust data for inflation.

Year-over-Year Change – Import Prices (blue line) and Export Prices (red line)

There are three cases of deflation outside of a recession – early 1990′s, late 1990′s, and mid 2000′s. Import price deflation is normally associated with the strengthening of the dollar relative to other currencies.

According to the press release:

All Imports: Prices for U.S. imports increased 0.2 percent in November, after decreasing 0.5 percent in October and rising 0.1 percent in September. The U.S. import price index declined 1.3 percent from November 2018 to November 2019. The 12-month decrease was the smallest over-the-year decline since the index fell 0.9 percent during the period ended May 2019. (See table 1.) Fuel Imports: Import fuel prices rose 2.6 percent in November following a 2.5-percent drop the previous month. The November advance was the largest monthly increase since the index rose 3.6 percent in May. The 48.5-percent increase in natural gas prices and the 1.1-percent rise in petroleum prices each contributed to the November advance in fuel prices. Fuel prices rose 0.8 percent over the past year. Prices for import petroleum increased 1.4 percent for the year ended in November and natural gas prices declined 10.0 percent over the same period.

All Exports: The price index for U.S. exports rose 0.2 percent in November following a 0.1-percent drop in October and a 0.3-percent decrease in September. Higher agricultural prices led the November increase. Overall export prices declined 1.3 percent over the past year; price decreases for nonagricultural exports more than offset rising agricultural prices. (See table 2.) Agricultural Exports: Agricultural export prices increased 2.2 percent in November, after rising 1.7 percent the previous month. A 3.4-percent advance in soybean prices drove the November increase. Agricultural export prices rose 2.5 percent from November 2018 to November 2019. Higher prices for soybeans, nuts, dairy, and corn all contributed to the over-the-year advance.

Month-over-Month Change – Import Prices (blue line) and Export Prices (red line)

The biggest mover of import and export prices is usually oil (imports) and agricultural products (exports).

Oil Import Price Change Month-over-Month (blue line) and Agriculture Export Change Month-over-Month (red line)

Caveats on the Use of the Export / Import Price Index

Both import and export prices index values shown in this post is a weighted average for the entire category of exports or imports. The BLS has many sub-categories relating to a particular commodity or goods. Econintersect using spot checks believes these subindexes are accurate.

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