U.S. import prices rise on surge in food costs
WASHINGTON (Reuters) - U.S. import prices rose more than expected in March as food prices recorded their largest increase in three years, but there was little sign of a broader pickup in imported inflation.
The Labor Department said on Thursday import prices increased 0.6 percent last month after an unrevised 0.9 percent rise in February.
Economists polled by Reuters had forecast import prices rising 0.2 percent in March.
In the 12 months through March, import prices fell 0.6 percent, pointing to still weak imported inflation that is helping to keep a lid on domestic price pressures.
The lack of inflation pressures in the economy suggest 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 reducing the amount of money it is pumping into the economy each month. The minutes of its March 18-19 policy meeting published on Wednesday suggested the Fed was not eager to start raising rates when its bond-buying program ends later this year.
Last month, import food prices jumped 3.7 percent, the biggest rise since March 2011, after falling 0.7 percent in February. Imported fuel prices rose 1.2 percent last month after advancing 5.3 percent in February.
Import prices excluding food and fuels rose 0.2 percent after slipping 0.1 percent in February.
The Labor Department report also showed export prices increased 0.8 percent in March, the largest gain since September 2012. That followed a 0.7 percent rise in February. In the 12 months through March, export prices gained 0.2 percent.
(Reporting By Lucia Mutikani; Editing by Paul Simao)
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