Inflation Dead Ahead: Core Import Prices Surge Most In 6 Years

Economists, but mostly traders, breathed a sigh of relief last month when US import prices (ex petroleum) printed an unexpected 0.2% drop last month, a big miss relative to expectations and recent gains.

However, as it turned out, this unexpected drop was merely a delayed effect by US trade partners, with inflation of rising foreign prices merely deferred, and in January import prices jumped by a whopping 1.0% M/M, in line with the highest monthly increase observed in the past five years.

Furthermore, excluding petroleum, the annual increase in import prices (NSA) rose to the highest in 6 years, as suddenly the US is importing far more inflation that previously expected.

And since this is usually a 2-3 month leading inflationary indicator, we expect this to manifest itself in rising prices sometime in the early spring, just as the Fed unveils its new and improved dot plot.

Finally, those wondering where this inflation is being imported from, the chart below should provide some hints.

Comments

Boing_Snap itstippy Fri, 02/16/2018 - 10:40 Permalink

Here's a good even handed discussion on Gold, Crypto, and the current state of affairs globally.

https://www.youtube.com/watch?v=p_ZtzEkpSzU

Time to understand what true digital Money is, Gold that is easily used digitally, converted at .5% fiat to gold and back. Hold your cash as gold, transfer from your bank account with a few clicks, load pre-paid cards and use them to live.

https://www.youtube.com/watch?v=p_ZtzEkpSzU

 

In reply to by itstippy

Fireman Fri, 02/16/2018 - 09:09 Permalink

The tsunami of toxic derivative shit and its IOU Saudi Mercan "soon to be the no longer reserve currency" petroscrip dollahs is mounting on the horizon and if anything is going to swamp the drains this will be it.

 

Finally all those endless judaic wars in "our" oil patch will have to be paid for; by US!

small axe Fri, 02/16/2018 - 09:10 Permalink

mission accomplished

the central banks must be pleased. Inflation has always been the end game of this debt charade. That and war ... a Keynesian's wet dream.

bshirley1968 small axe Fri, 02/16/2018 - 09:19 Permalink

Right. Real people love deflation. The parasitic, bankster class loves inflation.

Inflation is needed to pay off debt as higher prices help with the interest. Since most everyone is a debt slave now, everyone wants higher prices.....except when they are paying. It's a vicious cycle.

Key? Stay away from debt. Starve the beast.

In reply to by small axe

buzzsaw99 Fri, 02/16/2018 - 09:19 Permalink

idiocracy in action.  no let's don't put a tariff on imported chinese goods, no instead let's fuck with the exchange rate so they get even more usd.

TrustbutVerify Fri, 02/16/2018 - 09:29 Permalink

I don't understand why there isn't more talk about the need for inflation.  We - our national government - have a debt of $20 trillion and 4x - 5x that amount in unfunded entitlement mandates.  Inflation is the only way to deal with it.  I think the Fed would be secretly relieved if we has a little run-away inflation.  

In 10 or 15 years the Boomers will be dying of wholesale and the entitlement requirements will be shrinking along with the broader population numbers.  

itstippy TrustbutVerify Fri, 02/16/2018 - 10:29 Permalink

Inflating your way out of debt only works if:

1) Your debt is at a fixed rate of interest.

2) You are no longer acquiring new debt and are in the process of paying off your existing debt.

3) Your income rises with inflation.

The Federal Government continues to borrow $1T annually, and they do not repay old debt - they roll it over at the current interest rate.  Furthermore, the Federal Government has enacted huge tax cuts that will reduce its income going forward and force it to rely on borrowing even more.  In this situation inflation is a nightmare.

In reply to by TrustbutVerify

chestergimli Fri, 02/16/2018 - 09:41 Permalink

What was this I read several months ago about China deporting their deflation to the world?  You people who write these articles write them according to what your Jewish bosses want.  This also includes these hedge fund heads.  None of you have any idea which way your financial system is going as you are fighting over its trajectory.  That is why the whole world monetary system is going down.

abgary1 Fri, 02/16/2018 - 13:43 Permalink

There is a price to pay for trying to protect the US industries by devaluing the currency and instituting tariffs.

What's the alternative, drive down labor costs to compete with the developing nations?

Finding ways of employing Americans is difficult.