By David Harrison and Josh Mitchell
Prices for foreign-made goods imported to the U.S. fell in May in another sign of softening inflation.
Import prices fell 0.3% in May from the previous month, the Labor Department said Thursday. The number was in line with expectations from economists surveyed by The Wall Street Journal.
Data on import prices aren't adjusted for seasonality and exclude taxes and tariffs.
Over the past year, prices were down 1.5%, matching the largest drop since August 2016.
The decline reflects both the impact of a stronger U.S. dollar and efforts by businesses abroad to lower their prices to keep their products competitive in U.S. markets after accounting for new tariffs, said Blerina Uruci, an economist at Barclays.
The Wall Street Journal's Dollar Index is up 2.71% over the past 12 months to date.
Thursday's import-price numbers follow the Labor Department's inflation report for May released Wednesday, which showed growth in consumer prices slowed to 1.8% on the year. Also, on Tuesday, the department said the producer-price index--a measure of prices businesses receive for their goods and services--rose 0.1% in May from the previous month.
The three reports suggest that inflation pressures remain muted in the U.S. economy.
A 1% fall in the price of fuel imports, the largest since December, contributed to the overall decline. Prices for petroleum imports were down 0.9% on the month.
Federal Reserve officials will consider the prospect for inflation at their policy meeting next week. Inflation has been shy of the Fed's 2% target for much of the past seven years, but officials expect the recent weakness to be temporary. The Fed relies on a separate gauge of inflation produced by the Commerce Department. That measure has also been soft in recent months.
Officials are considering cutting interest rates in the months ahead to protect the U.S. economy from disruptions caused by a renewal of trade tensions. Some officials, however, have also raised the possibility of cutting rates to spur inflation closer to the goal.
Thursday's report also showed prices for U.S. exports fell 0.2% in May and were down 0.7% from the previous year.
The Labor Department report on import and export prices can be accessed at: http://www.bls.gov/news.release/ximpim.toc.htm<http://www.bls.gov/news.release/ximpim.toc.htm>
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