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U.S. Import Prices Continue To Fall Amid Another Sharp Drop In Fuel Prices

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With fuel prices showing another substantial decrease, the Labor Department released a report on Friday showing a continued decline in U.S. import prices in the month of September.

The Labor Department said its import price index fell by 0.5 percent in September following a revised 0.6 percent drop in August.

Economists had been expecting import prices to slide by about 0.7 percent compared to the 0.9 percent decrease originally reported for the previous month.

Import prices fell for the third straight month due to another steep drop in fuel prices, which tumbled by 2.1 percent in September and plunging by 3.1 percent in August.

Lower petroleum and natural gas prices contributed to the drop in fuel prices in September, falling by 2.0 percent and 5.0 percent, respectively.

The Labor Department said fuel prices decreased 5.8 percent over the past 12 months, reflecting the largest year-over-year decline since April of 2013.

Excluding the sharp drop in fuel prices, import prices edged down by a more modest 0.1 percent in September after showing no change in August.

Lower prices for non-fuel industrial supplies and materials and automotive vehicles more than offset an increase in prices for foods, feeds, and beverages.

The report also showed that export prices dipped by 0.2 percent in September after falling by 0.5 percent in August. Export prices had been expected to edge down by 0.1 percent.

Prices for agricultural exports showed another notable decrease, dropping by 0.9 percent in September after tumbling by 3.0 percent in the previous month.

The decrease in September was driven by a sharp drop in soybean prices as well as lower prices for meat and corn.

Prices for non-agricultural exports dipped 0.2 percent for the second consecutive month, reflecting lower prices for non-agricultural industrial supplies and materials, consumer goods, and automotive vehicles.

Compared to the same month a year ago, import prices were down by 0.9 percent in August, while export prices were down by 0.2 percent year-over-year.

Next week, the Labor Department is scheduled to release its more closely watched report on wholesale price inflation in the month of September.

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