WASHINGTON, Wed Dec 12, 2012 — Import prices recorded the biggest drop in five months in November as food and fuel costs tumbled, keeping inflation pressures subdued against the backdrop of weak economic activity.
Overall import prices fell 0.9 percent, the Labor Department said on Wednesday. October’s data was revised to show a 0.3 percent increase rather than the previously reported 0.5 percent gain.
Economists polled by Reuters had expected prices to fall 0.5 percent last month. In the 12 months to November, import prices fell 1.2 percent.
Stripping out fuels and food prices, import prices dipped 0.1 percent as the costs of capital goods fell by the most since March 2010 and automobile prices were flat, indicating that broader inflation pressures remained benign.
The tame inflation environment should allow the Federal Reserve to stay on its ultra-easy monetary policy course as it tries to nurse the economy back to health.
Officials at the U.S. central bank resume policy deliberations on Wednesday and are expected to reaffirm the Fed’s accommodative stance at the end of the two-day meeting.
Last month, imported petroleum prices fell 3.6 percent after slipping 0.2 percent in October. The price of imported natural gas surged 18.2 percent, the largest increase in three years. Imported food prices fell 1.3 percent, the biggest decline since February 2012, after edging up 0.2 percent the prior month.
Elsewhere, imported capital goods prices fell 0.3 percent after being flat in October.