August 1998 U.S. Import and Export Price Indexes

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-AUGUST 1998-

The U.S. Import Price Index declined 0.3 percent in August, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. The August decrease, the 10th consecutive monthly decline for the index, was attributable to the continued decline for nonpetroleum import prices. The U.S. Export Price Index fell 0.6 percent in August, after falling 0.1 percent and 0.6 percent in July and June, respectively.

IMPORTS EXPORTS Month Non- Agri- Nonagri- All Petroleum petroleum All cultural cultural Imports Imports Imports Exports Exports Exports

Import Goods

The 0.3 percent decline for import prices in August continued a three- year downward trend. Over the past 12 months, the index fell 6.4 percent compared with a 2.2 percent drop in the August 1996-97 period. Prices for nonpetroleum imports, which fell for the 11th consecutive month, were down 0.3 percent in August. Prices for petroleum imports edged up 0.3 percent after decreasing 3.1 percent in July and 4.5 percent in June. Over the past 12 months, the index for petroleum prices fell 31.8 percent after falling 8.8 percent in the August 1996-97 period. For the second consecutive month, import prices for all the major nonpetroleum commodity areas decreased. The index for foods, feeds, and beverages fell 2.4 percent in August, the largest decline in the index since July 1997. Over the past 12 months, this index dropped 5.1 percent. Imported capital goods prices continued a three year downward trend, falling 0.4 percent in August, slightly less than the rate of decrease posted in the two preceding months. Prices for capital goods declined 7.0 percent over the past 12 months. Prices for nonpetroleum industrial supplies and materials also were down in August, falling 0.4 percent after posting larger decreases of 1.0 percent in July and 1.1 percent in June. This index fell 6.0 percent over the past 12 months. More modest declines were again posted for autos, down 0.2 percent, and consumer goods, down 0.1 percent. Over the past year, these indexes fell 0.3 percent and 1.5 percent, respectively.

Export Goods

Export prices, down 0.6 percent in August, fell for the third consecutive month. For the year ended in August, this index decreased 4.0 percent. The index for agricultural prices led the decline in overall exports in August, decreasing 3.7 percent--the largest monthly change in the index since September 1996. Prices for agricultural exports had registered comparatively little movement in recent months after falling earlier in the year. The decline in August was largely attributable to falling prices for grains and oilseeds. Agricultural export prices fell 10.4 percent for the year ended in August after a 13.4 percent drop over the August 1996-97 period. The index of nonagricultural exports dipped 0.1 percent in August, the 12th consecutive month that this index has decreased. For the year ended in August, nonagricultural export prices were down 3.1 percent. The August decline in this index was attributable to a 0.3 percent decline for capital goods, the largest component of U.S. exports, and a 0.6 percent drop for nonagricultural industrial supplies and materials. The index of capital goods was down 2.8 percent over the past year and 0.5 percent over the August 1996-97 period. Prices for nonagricultural industrial supplies and materials have dropped for 13 consecutive months and were down 7.1 percent for the year ended in August. Exported automotive vehicle and consumer goods prices were unchanged in August. Over the past year, automotive vehicle prices rose just 0.1 percent, and consumer goods prices fell a modest 0.3 percent.

Imports by Locality of Origin

The price index of imports from Japan continued a three-year downward trend, decreasing 0.3 percent in August. The decline, however, was smaller than the 0.7 percent decreases posted in each of the two preceding months. Over the past 12 months the index declined 5.5 percent, compared with a 4.5 percent drop in the previous 12-month period. (See table 7.)

Price decreases for imports from the Asian Newly Industrialized countries also persisted in August. The index fell 0.1 percent in August after posting declines of 1.0 percent or more in each of the prior three months. Over the past 12 months, the index was down 9.4 percent, more than doubling the average decline recorded over each of the previous two years.

The price index for imports from the European Union fell 0.2 percent for the second consecutive month. For the year ended in August, the index decreased 1.3 percent, about the same as for the August 1996-97 period.

The price index for imports from Latin America also declined in August, down 1.6 percent. The decrease was led by a 6.0 percent decline for nonmanufactured goods.

In contrast, the index for imports from Canada edged up 0.1 percent last month after posting no change in July. The index, however, was down 3.2 percent on average over the past 12 months.