Imports and Exports Remain Low in November

The cross-border price pressures continued to be negative, with import prices down 0.4% in November and export prices down 0.6%. These missed the Bloomberg consensus estimates of down 0.8% in import prices and down 0.3% in import prices.

Petroleum fell 2.5% in November but is not an isolated factor pulling prices down, as non-petroleum import prices fell 0.3% in the month. Agricultural exports were the wildcard on the export side, and they fell a sizable 1.1%. But here too, the deflationary pull is widespread, with non-agricultural export prices down 0.6%.

The contraction from the previous year is perhaps less severe than prior months but not by much. Import prices are down 9.4% year over year, with non-petroleum import prices at negative 3.4%.
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Import prices from Canada are down the heaviest, at negative 18.0% on the year, with Latin America next at minus 12.7%. Showing the least price weakness are imports from China at negative 1.5%. Export prices are down 6.3% on the year, with non-agricultural prices down 5.7%.

One special concern noted in the report are continuing incremental decreases for prices of finished goods, both imports and exports. Federal Reserve policy makers have waited for an easing drag from low import prices, not to mention oil prices as well, with neither yet appearing. Contraction in import prices not only reflects low commodity prices but also the strength of the dollar, which has been giving U.S. buyers more for their dollars.
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