U.S import prices fell by 0.3% in February. This in fact is the eighth consecutive month that the the United States has seen import prices decline. This continual drop has been due largely in part to declining costs of oil and the strong value of the dollar among others. Although the prices have continued to drop, they have been decreasing less and less over the last couple of months. This very well could be an effect due to the rally of the dollar fading and oil prices that are beginning to stabilize. The article notes that should these trends continue we may begin to see a rise in prices and possibly also begin to see domestic inflation be propped up. It is important to note that the possible inflation increase would not be drastic, but would allow the rate to be inch closer to the Fed's target of two percent. I think it will be interesting to see how this plays out in the coming months. I wonder if the dollar rally will continue to fade, or if oil prices will actually stabilize in the near future. It will also be interesting if these conditions due in fact continue to see what reaction or possible actions the Fed would take in response.
http://www.cnbc.com/2016/03/11/us-import-prices-feb-2016.html
No comments:
Post a Comment