WASHINGTON, Nov 15 (Reuters) - - U.S. import prices rose for a second straight month in October as the cost of petroleum and motor vehicles increased, but persistent dollar strength continued to keep underlying imported inflation subdued.
The Labor Department said on Tuesday import prices increased 0.5 percent last month after an upwardly revised 0.2 percent gain in September. It was the second straight month of gains.
Economists polled by Reuters had forecast import prices rising 0.4 percent last month after a previously reported 0.1 percent increase.
In the 12 months through October, import prices fell 0.2 percent, the smallest decrease since July 2014, after declining 1.0 percent in September.
The strong dollar has resulted in the country importing deflation, helping to hold inflation persistently below the Federal Reserve’s 2 percent target.
But with the dollar’s rally gradually fading and oil prices continuing to stabilize, some of the deflationary pressures from overseas are easing, which should allow inflation to steadily rise toward its target.
Last month, imported petroleum prices surged 7.5 percent after rising 1.6 percent in September. Import prices excluding petroleum dipped 0.1 after being unchanged the prior month. The cost of imported food fell 0.6 percent.
Prices for imported capital goods slipped 0.2 percent, while the cost of imported automobiles increased 0.3 percent. Imported consumer goods prices excluding automobiles edged up 0.1 percent last month.
The report also showed export prices rose 0.2 percent in October after gaining 0.3 percent in September. Export prices were down 1.1 percent from a year ago. That was the smallest decline since October 2014.
Reporting By Lucia Mutikani; Editing by Andrea Ricci