US: Import and Export Prices

February 10, 2017 07:30 CST

Consensus Consensus Range Previous
Import Prices - M/M change 0.2% 0.0% to 0.8% 0.4%
Export Prices - M/M change 0.1% -0.1% to 0.2% 0.3%

Market Consensus Before Announcement
Import prices and export prices have been on the rise with both in the year-on-year plus column for the first time since the oil collapse in July 2014. But outside of petroleum and petroleum-related components, pressure in this report has been marginal. The Econoday consensus calls for a modest 0.2 percent increase in January import prices and a 0.1 percent rise for export prices.

Import price indexes are compiled for the prices of goods that are bought in the United States but produced abroad and export price indexes are compiled for the prices of goods sold abroad but produced domestically. These prices indicate inflationary trends in internationally traded products.

Changes in import and export prices are a valuable gauge of inflation here and abroad. Furthermore, the data can directly impact the financial markets such as bonds and the dollar. The bond market is especially sensitive to the risk of importing inflation because it erodes the value of the principal (the original investment) which is paid back when the bond matures. It also decreases the value of the steady stream of interest rate payments on this type of security. Inflation leads to higher interest rates and that's bad news for stocks, as well. By monitoring inflation gauges such as import prices, investors can keep an eye on this menace to their portfolios.