Import prices rose for an eighth straight month in May despite a drop in fuel costs, with the year-on-year increase reaching its highest level in nearly three years.
The Labor Department says import prices climbed 0.2% last month, confounding forecasts for a 0.7% decline and following April's revised 2.1% jump. In the year to May, import prices surged 12.5%, the largest gain since September 2008.
"This is simply reflecting the increase in import petroleum prices," says Anthony Karydakis, senior U.S. economist at Commerzbank AG. "Excluding petroleum, import prices have been very subdued."
The trend of higher energy prices was already being reversed with petroleum import prices falling 0.4% in May, the first decline since September 2010.
Overall export prices rose 0.2% after a downwardly revised 0.9% gain. Analysts had been looking for a 0.3% gain.
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