U.S. Import Prices Rise by Most in a Year (1.6% in May -twice forecast)

[papau]

http://www.bloomberg.com/news/economy/economies.html

U.S. Import Prices Rise by Most in a Year on Higher Cost of Petroleum
June 10 (Bloomberg) -- Prices of goods imported into the U.S. rose in May by the most in more than a year, led by higher costs for petroleum, building supplies and metals, government figures showed. Excluding petroleum, prices increased.

Last month's 1.6 percent increase in the import price index, twice what economists had forecast, followed a 0.2 percent rise in April, the Labor Department's figures showed. Excluding petroleum, the index, which gauges the cost of goods and raw materials from abroad, rose 0.4 percent after a 0.3 percent rise. <snip>

"This is one more reason that inflation will have an upward bias,'' said Michael Englund, chief economist at Action Economics LLC, a Boulder, Colorado-based forecasting firm. ``It's because of the strength in the U.S. economy, global demand and the weakness in the U.S. dollar.''

Excluding petroleum, import prices rose 3 percent in May, the biggest year-over-year increase since a 3.6 percent rise in September 1995. <snip>

The cost of all imported goods last month was 7 percent higher than in May 2003. That was the biggest 12-month increase since February of last year. <snip>