Import prices in U.S. rose 0.7% in August as energy costs jumped

By Michelle Jamrisko
Bloomberg News

WASHINGTON - Prices of goods imported into the U.S. rose in August for the first time in five months as the cost of petroleum surged.

The 0.7 percent increase in the import-price index was less than forecast and followed a revised 0.7 percent decline in July, the Labor Department reported today in Washington. Economists projected the August gauge would rise 1.5 percent, according to the median estimate in a Bloomberg survey. Costs excluding fuel decreased for a fourth month.

The cost of goods and materials other than oil from abroad may be restrained as cooling markets from Europe to Asia limit demand for commodities like metals. Companies may find it difficult to pass along higher energy prices as consumers face limited job and income growth.

“The underlying picture on prices is generally subdued,” Sean Incremona, senior economist at 4Cast Inc. in New York, said before today’s report. “Most of the upside we’re seeing recently is going to be due to oil prices, which have rebounded pretty significantly from lows earlier this year. Final demand looks weak across the board.”

Projections for August import prices ranged from a 0.5 percent decrease to a 2 percent increase, according to the Bloomberg survey of 47 economists.

Against a backdrop of limited inflation, Federal Reserve policy makers will weigh additional accommodation to help bolster an economy that’s weakened this year. Chairman Ben S. Bernanke and his colleagues at the central bank, who begin a two-day meeting today, may add to record monetary stimulus.

Bernanke last month at a speech in Jackson Hole, Wyoming, made the case for unconventional policies.