WASHINGTON (Reuters) - U.S. import prices unexpectedly fell in December amid a decline in the cost of petroleum products, adding to signs that the worst of high inflation was probably over.
Import prices dropped 0.2% last month, the first decrease since August, after increasing 0.7% in November, the Labor Department said on Friday. In the 12 months through December, prices rose 10.4% after advancing 11.7% in November.
Economists polled by Reuters had forecast import prices, which exclude tariffs, gaining 0.3%.
The government reported on Thursday that producer prices rose just 0.2% in December, the smallest increase since November 2020. Hopes that inflation has peaked or is close to doing so where boosted by a moderation in China's producer prices in December. Economists expect slower Chinese PPI will eventually show up in the U.S. prices. Supply chains are also improving.
Imported fuel prices declined 6.5% last month after rising 2.3% in November. Petroleum prices fell 6.0%, while the cost of imported food increased 0.5%.
Excluding fuel and food, import prices rose 0.5%. These so-called core import prices advanced 0.6% in November. They increased 5.7% on a year-on-year basis in December.
The report also showed export prices tumbled 1.8% in December after rising 0.8% in November. Prices for agricultural exports rose 0.8%. Nonagricultural export prices dropped 2.1%.
Export prices increased 14.7% year-on-year in December. That followed a 18.2% annual surge in November.