WASHINGTON (Reuters) - Import prices in April recorded their largest drop in 10 months as energy costs tumbled, according to a government report on Thursday that also showed tame underlying inflation pressures from imports.
Overall import prices fell 0.5 percent, the Labor Department said. March’s data was revised to show a 1.5 percent increase rather than the previously reported 1.3 percent gain.
Economists polled by Reuters had expected prices to fall 0.2 percent last month. In the 12 months to April, import prices increased 0.5 percent, the weakest reading since October 2009.
Stripping out petroleum, import prices were flat as weak capital goods costs offset the largest increase in automobiles prices in 10 months, indicating that broader inflation pressures remained benign - in line with the Federal Reserve’s view.
Data on Friday is expected to show that weak energy costs held down wholesale prices in April for a second month in a row, according to a Reuters survey.
Outside food and energy, producer prices are expected to have moderated, with a gain of 0.2 percent forecast after a 0.3 percent increase in March.
Last month, imported petroleum prices fell 1.8 percent, the largest drop since August, after rising 4.9 percent in March.
That should pull down gasoline prices from their recent highs and support economic growth, despite signs of cooling in activity.
Imported food prices ticked up 0.1 percent after increasing 1.8 percent the prior month.
Elsewhere, imported capital goods prices were unchanged after advancing 0.2 percent in March. Imported motor vehicle prices rose 0.4 percent after increasing 0.3 percent the previous month.
The Labor Department report also showed export prices rose 0.4 percent last month, above analysts’ expectations for a 0.2 percent gain. Export prices increased 0.8 percent in March.
Reporting By Lucia Mutikani; Editing by Neil Stempleman