The numbers: The cost of imported goods fell 1.4% in July, the U.S. Labor Department said Friday. This is the first decline since December and the largest since April 2020.
Economists polled by the Wall Street Journal had forecast a 1% decline.
Import prices minus fuel fell 0.5% in July, the third straight monthly decline.
Key details: The cost of imported fuel fell 7.5% in July, the first decline of the year. Despite the drop, fuel import prices are up 56.6% over the past year.
The decline in nonfuel imports was led by industrial supplies and food, which offset higher prices for autos and capital goods.
Over the past year, import prices have risen 8.8%, the smallest advance since March 2021. Nonfuel prices are up 4.1% over the same period.
Export prices fell 3.3% in July. They are up 13.1% over the past year.
Big picture: The data show again how central energy prices are to the U.S. economy. In addition, the cumulative effect of recent dollar strength appears to be starting to suppress non-fuel import prices.