U.S. import and export prices fall in June

The U.S. import prices dropped in June, in line with the weakening theme seen in other price measures. The total import prices dropped 0.2 percent in June, the second consecutive drop. The drop is mainly due to the 2.2 percent fall in fuel prices. On a year-on-year basis, import prices eased to a 1.5 percent rate, down from the recent cycle high of 4.6 percent in February.

Import prices, excluding fuel rose 0.1 percent as gains in capital goods and foods/beverages countered declines in industrial supplies, autos/parks & consumer goods.

Meanwhile, total export prices dropped for the second consecutive month in June. Export price index fell 0.2 percent after falling 0.5 percent in May. The drop was driven by agriculture prices, falling 1.5 percent as non-agricultural prices stayed flat on the month. Expectations for a softening U.S. dollar is likely to pressure nonfuel import prices higher, supportive to the U.S. Fed’s projection that inflation would slowly climb in the second half of this year, noted Wells Fargo in a research report.

At 17:00 GMT the FxWirePro's Hourly Strength Index of US Dollar was slightly bearish at -62.097. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex

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