Import prices are posing evidence that the weak dollar is increasing inflation pressures. Key readings are import prices excluding petroleum, up 0.4 percent in September following a 0.3 percent rise in August, and import prices for industrial supplies excluding petroleum, up 1.5 percent following August's 1.1 percent rise. Pressures may now be beginning, in a mild way, to find their way to finished goods with prices for consumer goods excluding autos up 0.1 percent following two prior months of decline and prices for capital goods up 0.1 percent to end a long string of no changes.
But the headline readings are tame. Total import prices rose only 0.1 percent reflecting a 1.1 percent downswing in prices for petroleum products. But with oil prices now back above $75, the petroleum reading for October is likely to show an upswing. The report also includes export prices which fell 0.3 percent reflecting a downswing in agricultural prices of 2.8 percent. Finished goods prices for both consumer and capital goods exports rose 0.1 percent. Today's overall results pose little trouble for the September consumer and producer price headlines though they do indicate rising pressures for crude and intermediate goods in the producer price report.