Economic Report: U.S. import prices up 0.1% in September, much weaker than forecast

United States

The numbers: The U.S. import price index rose 0.1% in September, the Labor Department said Friday. This is the third straight increase.

The rise was much less than expected. Economists surveyed by the Wall Street Journal were expecting a 0.5% gain.

Excluding fuel, import prices were down 0.2% for the second straight month. Import prices excluding fuel haven’t risen since February.

Key details: The cost of energy, mainly petroleum and natural gas, rose 4.4% in September, the fourth straight month. 

Import prices have been helping to lower inflation but higher fuel prices are upsetting that trend. The rate of import inflation over the past 12 months was down 1.7% in September, the smallest decline since February and up from a 6.1% decline in June.

Big picture: The Federal Reserve tries to look past developments in energy markets to gauge inflationary trends. Inflation data for September shows a pause in the steady decline in price pressures. Data over the next few months will show whether the Fed has more work to do to get inflation on a steady downward trend.

Market reaction: Stocks DJIA SPX were set to open higher on Friday. The 10-year Treasury yield BX:TMUBMUSD10Y dropped 10 basis points to 4.60% in early trading, continuing the pattern of sharp moves in the bond market.