U.S. Import, Export Prices Unexpectedly Fall in April

U.S. import prices unexpectedly fell in April as the cost of food and fuels declined, suggesting imported inflation pressures remain benign.

The Labor Department said on Tuesday import prices fell 0.4 percent last month after rising 0.4 percent in March. April's decline in import prices was the first since November.

Economists polled by Reuters had forecast import prices rising 0.3 percent. In the 12 months through April, import prices fell 0.3 percent.

The lack of inflation pressures in the economy suggests the Federal Reserve could keep monetary policy very accommodative for a while even as labor market slack starts to ease.

The U.S. central bank slashed overnight interest rates to a record low of zero to 0.25 percent in December 2008 and pledged to keep them low while nursing the economy back to health. The Fed is scaling back the amount of money it is injecting into the economy through monthly bond purchases.

Last month, imported food prices fell 0.7 percent after surging 3.4 percent in March. Imported fuel prices dropped 1.7 percent last month after rising 0.6 percent in March.

Natural gas prices tumbled 18.5 percent in April, the largest fall since July 2013.

Import prices excluding food and fuels inched up 0.1 percent after rising by the same margin in March.

The Labor Department report also showed export prices fell 1.0 percent in April. That was the biggest drop since June 2012 and followed a 1.0 percent rise in March. In the 12 months through April, export prices nudged up 0.1 percent.