U.S. Import Prices Sink 1.8% In August, Down 11.4% In Past Year

The prices the U.S. paid for imported goods fell by a seasonally adjusted 1.8% in August, marking the biggest decline since the start of the year. Oil prices fell sharply again and strong dollar has also made foreign products cheaper for Americans to buy. Excluding fuel, U.S. import prices declined by a 0.4% last month, the Labor Department said Thursday. Meanwhile, the price of U.S.-made goods exported to other nations dropped 1.4%. From August 2014 to August 2015, import prices tumbled 11.4%, the biggest year-over-year drop since the last year of the Great Recession in 2009. The plunge in oil prices and a soaring dollar are the main culprits. Import prices minus fuel are down a smaller but still sharp 3% year over year. That's also the largest 12-month decline since 2009. Falling import prices are a significant factor in keeping U.S. inflation low at a time when the Federal Reserve wants to see prices increase. Lower prices for American exports have also hurt sales and profits of companies such as large manufacturers that do a lot of business overseas.