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Economic Report: Import prices jump 12.5% in past year and offer no respite from high inflation

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The numbers: The cost of imported goods such as oil and food rose a sharp 2.6% in March, helping to fuel the worst episode of high U.S. inflation since the early 1980s.

The increase was the largest since 2011. Economists polled by The Wall Street Journal had forecast a 2.2% advance.

A surge in oil prices after the Russian invasion of Ukraine explained a large part of the increase last month. Even if fuel is set aside, however, import prices rose a still-strong 1.2% in the month.

The cost of imported goods has leaped 12.5% in the past year, the highest since 2011.

Import prices minus fuel has risen 7.5% in the same span.

Key details: The cost of oil leaped 16.1% in March and accounted for about half of the increase in import prices.

Oil rose sharply in 2021 and jumped to a 13-year high in early March shortly after the Ukraine conflict erupted.

A barrel of oil now fetches over $100, double the amount compared to a year earlier. Prices have leveled off in April, however.

Prices also rose for imported food, drinks, consumer goods and industrial supplies.

Export prices rose 4.5% in March, and they are up 18.8% in the past year.

Big picture: Inflation is everywhere and it’s not going to come down quickly. Both consumer and wholesale prices soared again in March.

The war in Ukraine and lockdowns in China could even exacerbate the problem, at least temporarily.

The Federal Reserve, for its part, plans a series of increases in interest rates to try to tame inflation, but higher rates take awhile to have an effect.

Market reaction: The Dow Jones Industrial Average
DJIA,
+0.59%

and S&P 500
SPX,
-0.08%

rose in Thursday trades.

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