Import and Export Slide Modest in Soaring Dollar Environment

The trade price report revealed only modest November price drop-backs in the face of a soaring dollar, with relative price firmness for exports versus imports, as seen throughout 2016, that beat estimates. There were November trade price drops of 0.3% for imports and just 0.1% for exports, with a 4.7% oil import price decline and a 0.6% food export price rise. Import prices have received a big lift since February from the rebound in oil prices, and ex-oil trade prices received a lift through mid-year from a drop in the dollar between January and April. Yet, the dollar has reversed course since Brexit and U.S. elections, leaving downward pressure on prices beyond oil price gains that accompany ongoing headwinds from the global growth slowdown, petro-sector dislocation, and the inventory overhang that has reversed course in Q3-Q4.