U.S. import prices rise below expectations in October

Import prices in the U.S. rose 0.2 percent sequentially in October, while export prices rose just 0.1 percent. Both the prints were below the consensus expectations. The slowdown at the headline level was not surprising. Energy prices were up after landfall of the three major hurricanes in August and September, but futures prices and production improvements implied that this rise would be transitory. Petroleum import prices were up 4.4 percent in August and 6.3 percent in September. However, in October, the prices were up just 1.7 percent and imply that the storm-induced rise in import petroleum prices is possibly complete, noted Barclays in a research report.

Stripping petroleum imports, non-petroleum import prices rose 0.1 percent in the month, as several categories were greatly countered. Import prices for industrial supplies and capital goods continue to rise, showing that the acceleration in business investment for much of this year might be exerting upward pressure on prices of capital-related products. However, consumer goods imports have not shown the same trend firming, despite the rough 10 percent depreciation in the trade-weighted U.S. dollar year-to-trade, noted Barclays.

At 18:00 GMT the FxWirePro's Hourly Strength Index of US Dollar was slightly bearish at 8.70742. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex

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