US import prices have dropped for eight months. However, it is likely to have increased by 1.5% in March, according to Societe Generale. Trend implies that import prices will improve sooner as the pace of declines has decelerated in recent months.
“Our forecast corresponds to a 4.6% slowing on a year-over-year basis, a level last seen in November 2014, roughly when global petroleum prices first began their drop”, noted Societe Generale.
Since the core US CPI has continued to be strong through most of the decline in external quotes, the question is raised regarding the effect of import prices on domestic inflation, said Societe Generale. Nonetheless, for the first time since mid-2014, US CPI and IPI are likely to have started moving in positive directions.
