The U.S. June trade price report was mixed
The U.S. June trade price report was mixed, with a weaker-than-expected 0.4% import price decline and a stronger-than-expected 0.3% increase in export prices. Import prices were restrained by a 0.8% petroleum import price drop. Ex-petroleum prices were also weak, falling 0.3%, the first decline since December. The export price gain reflected a 0.4% increase in non-agricultural export prices, as agricultural prices declined 1.0%. Core price readings were weaker than prior months gains. Analysts expect export prices to be flat in July, alongside an import prices rise of 0.2%. Export prices ex-agriculture and import prices ex-petroleum are poised for respective 2018 gains of 4% and 2% Dec/Dec, following respective gains of 2.9% and 1.4% in 2017 and 1.4% and 0.3% in 2016. Trade prices continue to climb alongside a gradual up-tilt in domestic inflation, though tariffs should depress the trade price measures going forward despite upward domestic price pressure, as the indexes gauge pre-tax price levels.