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September 2004, Vol. 127, No. 9
U.S. import and export prices in 2003
Melissa E. Schwartz
In 2003, overall U.S. import and export prices increased for the second consecutive year.1 Prices for imports rose 2.4 percent, following a 4.2-percent rise in 2002, while export prices gained 2.2 percent, up from a 1.0-percent rise in 2002. During 2001–03, U.S. economic indicators for prices suggested a marked slowdown in inflationary pressures, and in May of 2003, the Federal Reserve Board expressed concern over the possibility of an "unwelcome substantial fall" in inflation.2 Nevertheless, prices for agricultural and petroleum products—traditionally volatile price components—strengthened along with prices for other raw materials during 2003 to bring about overall gains for the year. However, the increases in prices for these two commodity areas, along with the depreciation of the U.S. dollar against many major foreign currencies, did not appear to have a significant impact on prices for imported finished goods.
Prices for imported petroleum and petroleum products led to the overall growth in import prices, but the 12.8-percent increase in the petroleum index was up far less than the sharp increase of 56.9 percent in 2002. The increase in the index for all imports excluding petroleum accelerated in 2003, rising 1.2 percent, compared with a modest 0.3-percent advance the previous year, as nearly all major categories of imports recorded price increases in 2003. The U.S. dollar’s depreciation against many major currencies appeared to have a small impact on the 2003 increases in prices for imported finished goods.
Agricultural and nonagricultural export prices both increased in 2003 by larger amounts than in 2002, triggering the largest gain in the overall export price index since 1995. Over the past year, agricultural export prices jumped 13.4 percent, while nonagricultural commodities prices, led primarily by increases in prices for raw materials, were up 1.3 percent. Both components marked their largest December-to-December increase in the index since 1995. Automotive and consumer goods prices also increased in 2003, while the index for the capital-goods component posted its eighth consecutive annual decline. (See table 1.)
This excerpt is from an article published in the September 2004 issue of the Monthly Labor Review. The full text of the article is available in Adobe Acrobat's Portable Document Format (PDF). See How to view a PDF file for more information.
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1 Annual percent changes are calculated from December to December, unless otherwise specified. Data are not seasonally adjusted.
2 Federal Open Market Committee Statement, May 6, 2003.
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