Import prices rose 0.3% in April  with export prices up 0.5%.

In March, import prices rose 0.3% and exports 0%.

If we call 0% a gain, this is the first back-to back gain since May-June 2015.

Bloomberg Econoday reports


The rise in oil prices gave a second straight but still limited boost to cross-border inflation pressures in April. Import prices rose 0.3 percent to match March’s revised gain. These are the first back-to-back monthly gains since June and May last year. The year-on-year change, at minus 5.7 percent, is the best since December the year before, 2014. Petroleum imports are behind the improvement, up 4.1 percent in April following a big 9.6 percent gain in March. Higher petroleum prices have boosted industrial supplies the past two months though durable goods, less directly affected by oil, also show two straight solid gains. The gains haven’t helped finished prices yet which, in low single-digit decline, show no improvement.

Export prices rose 0.5 percent in April for the best showing since May last year. The year-on-year rate at minus 5.0 percent is the best since January last year. Agricultural prices boosted April but are still down nearly 10 percent on-the-year. One sign of strength, echoing the durables gain on the import side, is a rare monthly jump in capital goods prices which, year-on-year, are still down but only fractionally.

Country data show improvement across most trading partners but are still in the negative column. Import prices with China are down 1.9 percent year-on-year with the EU down 1.6 percent.

The decline underway this year in the dollar is another major factor that should help lift import prices which, though still concentrated in oil, are showing improvement and will help what has been a stubbornly weak inflation outlook.

Import and Export Prices

import-export prices 2016-05-12

Export prices did much better than the econoday consensus estimate of 0.0%. Import prices, despite rising oil did not live up to economists’ expectations of +0.6%.

US consumer demand is weakening. That’s a boon to the trade deficit, but consumer demand is not all based on imports.

For example, auto sales have been weak. New home sales barely had any recovery at all.

Europe is a basket case. Chinese credit is overheating.

None of this portends a strengthening global economy.

Mike “Mish” Shedlock