WASHINGTON (Reuters) - U.S. import prices barely rose for a third straight month in December as a surge in the costs of fuels ad foods was offset by weakness elsewhere, which bodes well for the inflation outlook.
Import prices edged up 0.1% last month, matching the reading from the previous two months, the Labor Department's Bureau of Labor Statistics said on Thursday.
The gain in import prices, which exclude tariffs, was in line with economists' expectations.
In the 12 months through December, import prices increased 2.2% after advancing 1.4% in November.
Government data this week showed producer inflation moderated in December while consumer prices picked up on higher energy and food costs. The disinflationary trend, however, remains in place, with consumer prices excluding the volatile food and energy components rising marginally last month.
The Federal Reserve is expected to keep interest rates unchanged at its policy meeting this month. Financial markets are expecting a rate cut only in June. The U.S. central bank's benchmark overnight interest rate has been reduced by 100 basis points to the 4.25%-4.50% range since it launched its policy easing cycle in September.
The policy rate was hiked by 5.25 percentage points between March 2022 and July 2023.
Imported fuel prices jumped 1.4% in December, the most since last April, after rising 0.9% in November. Higher costs for natural gas and petroleum accounted for the increase in fuel prices.
Food prices shot up 2.8% after advancing 1.4% in November.
Excluding fuels and food, import prices fell 0.2% after being unchanged in November. Core imported inflation is being subdued by the dollar's strength against the currencies of the main U.S. trade partners. In the 12 months through December, core import prices increased 1.9%.
Prices of imported capital goods dropped for a second straight month as did those for automotive vehicles, parts and engines. Imported consumer goods, excluding automotives, were unchanged for a second consecutive month.