Import Prices +0.7% vs +0.4% Est — China's Biggest Rise in 22 Years, and Fuel Didn't Do It

Fundamentals · 2026-09-16

Import prices rose 0.7% m/m in August against a 0.4% consensus, after declines of 0.3% in both July and June, and are +7.0% y/y — the largest annual rise since August 2022. Fuel did none of it: fuel imports fell 0.1% on the month, while nonfuel imports rose 0.8% and are +5.5% y/y, the most since May 2022. Import prices from China rose 1.0%, the largest monthly advance since that index began in January 2004, driven by computer and electronic product manufacturing. Capital goods +0.9% m/m, +7.3% y/y; nonfuel industrial supplies +2.0%; finished metals +5.7%; consumer goods ex-autos +0.5%; autos unchanged. Canada -0.8%, EU +0.9%, UK +3.9%, Asian NICs +3.0%. Natural gas imports +102.6% y/y. Exports +0.6% m/m, +8.6% y/y. Terms of trade with China -2.1%. Next release 16 October.

What It Changes

It is the third inflation-adjacent upside surprise of a single morning, hours before the FOMC decides. Retail sales beat by 0.4pp, core retail by 0.9pp, and imported inflation just printed a four-year high. A hike to 3.75%-4.00% was already 92% to 93% priced; nothing here argues against it.
The import-price story stopped being an energy story this month. For most of 2026 the annual rise was fuel. In August fuel fell 0.1% and nonfuel rose 0.8% — so the 7.0% annual figure now has a core underneath it, and nonfuel at 5.5% y/y is the fastest since May 2022.
The China number is the one to remember. A 1.0% monthly rise is the largest in the 22-year history of that index. Chinese goods have been the disinflationary anchor of the US import basket for two decades, and that anchor just moved.
Capital goods are 31% of the import basket and are rising at 7.3% a year. The named drivers are computers, semiconductors and telecoms equipment — the AI build-out, arriving through the border price index rather than the capex line.
It does not move markets, and it should not be read as if it did. This is a second-tier release on an FOMC day. Its value is as evidence about the inflation pipeline, not as a catalyst.

Impact

USD — Slight bullish — imported inflation at a four-year high supports the hawkish path, though this release has never been a dollar catalyst on its own and today belongs to 14:00.
This morning's Open had DXY at 99.66, up 0.04%, with the 10-year closing Tuesday at 4.996% after touching 5.04% intraday. Import prices add to the case for those levels rather than challenging it.
The cleaner FX read is in the country detail, and it is about the other currency. Import prices from Canada fell 0.8% on the month while prices from the EU rose 0.9% and from the UK rose 3.9%. That is the energy complex and the exchange rate showing up at the border, and it matters more for 6C and 6B than the headline does.
US Indices (ES / NQ / YM / RTY) — Slight bearish — rising input costs at the border compress margins for importers, and the categories rising fastest are the ones corporate America is buying most of.
NQ carries the specific exposure. The single named driver of the China increase is computer and electronic product manufacturing, and import capital goods prices rose 0.9% on the month and 7.3% on the year on computers, semiconductors and telecoms equipment. That is a direct cost line for the AI build-out.
Futures came into the print +0.2% to +0.4% across Dow, S&P and Nasdaq-100 in relief after the S&P's fifth decline in six sessions.
Gold (GC) — Slight bearish — another datapoint on the hawkish side of a decision gold is already trading as a rates instrument.

Inside The Number

Import prices rose 0.7% in August against a 0.4% consensus, following declines of 0.3% in July and 0.3% in June. On the year they are up 7.0%, which the BLS notes is the largest over-the-year increase since the index rose 7.7% for the twelve months ended August 2022.

The composition is the news, because it inverted. Through the spring this index was an energy index: fuel imports rose 10.2% in March, 18.9% in April and 12.1% in May, dragging the headline up while nonfuel barely moved. In August that reversed. Fuel fell 0.1% — natural gas down 1.0%, petroleum up just 0.1% — while nonfuel imports rose 0.8%, their strongest month of the year. Fuel prices have now fallen 10.2% over the three months to August, the largest quarterly decline since the three months ended May 2025.

So the headline and the underlying number swapped roles. Nonfuel import prices are up 5.5% over the year, the largest annual rise since the index advanced 5.9% for the twelve months ended May 2022. Strip out food as well and the picture is the same: imports excluding food and fuels are +5.6% y/y.

Now the finding that will outlast the print. Import prices from China rose 1.0% in August — the largest monthly advance since the index was first published in January 2004. To understand why a move that small is a record, look at the level: that index is based at 100 in December 2003, and after this record jump it sits at 99.9. Chinese import prices are, to a rounding error, exactly where they were twenty-two years ago. Two decades of Chinese goods getting cheaper in dollar terms is the single largest disinflationary force in the modern US import basket, and August is the biggest monthly break in it on record. On the year the index is up just 3.0%, so this is one month, not a trend — but it is the first month of its kind.

The BLS names the driver precisely: computer and electronic product manufacturing. That is not a tariff pass-through story in isolation; it is the semiconductor and hardware complex, and it lines up with what the capital goods line is doing.

Capital goods are where the real weight sits. They are 31.1% of the import basket by relative importance — the largest single category, larger than industrial supplies at 23.5% and consumer goods at 24.4%. Capital goods import prices rose 0.9% on the month and 7.3% on the year, with nonelectrical machinery up 1.2% and 9.0%. The BLS attributes the monthly rise to computers, peripherals and semiconductors; industrial and service machinery; and telecommunications equipment. Set that against the running narrative: capital goods imports have been running +46.9% y/y by value while domestic core capital goods orders managed +0.2%, and electronic components have been in short supply for eighteen months. The price index is now confirming what the volume data implied.

Industrial supplies moved hardest of all. Nonfuel industrial supplies and materials rose 2.0% on the month and are +12.6% on the year. Inside that, finished metals related to durable goods jumped 5.7% in a single month and are up 15.5% annually, while nonmetals related to durable goods rose 3.6% and unfinished metals sit at +26.7% y/y. Section 232 steel and aluminum duties have been named directly by ISM respondents for months; this is what they look like at the border.

Consumer goods are the quiet part, and that matters for CPI. Consumer goods excluding automotives rose 0.5% on the month and just 2.4% on the year. Automotive vehicles, parts and engines were unchanged on the month and are up 0.8% on the year. Together those two are 38.6% of the basket, and neither is generating much pressure. So the imported inflation accelerating here is arriving in producer inputs and capital equipment, not yet on the shelf.

The energy lines still carry extraordinary annual numbers even while falling monthly. Petroleum and petroleum products are +27.3% y/y despite a 0.1% monthly rise, and import natural gas prices are up 102.6% over the year — more than doubled — despite falling 1.0% in August. Crude petroleum fell 3.4% on the month and is +22.0% on the year. Treat the monthly softness as stale: this is August data, and WTI settled $105.83 on Tuesday after a 4.4% single-session jump on the Saudi supply scare.

On the export side, the terms of trade are moving against the US with one partner in particular. Export prices rose 0.6% on the month and 8.6% on the year, outpacing imports. But prices for exports to China fell 1.1%, the largest monthly decline since June 2025, while import prices from China rose 1.0% — so the US terms of trade index with China fell 2.1% in August after a 0.7% decline in July. The US is paying more for Chinese goods and receiving less for what it sends back.

Agricultural exports rose 0.5% and are +5.8% y/y, the largest annual rise since December 2022, on corn, soybeans, oilseeds and animal feeds. That index has not fallen in a single month since December 2025.

The Internals

The headline series, month and year:

Series · Aug m/m · Jul m/m · y/y · Note

All imports · +0.7% · -0.3% · +7.0% · Consensus was +0.4%; biggest annual rise since Aug 2022

Imports excluding fuel · +0.8% · +0.3% · +5.5% · Biggest annual rise since May 2022

Imports excluding food and fuels · +0.8% · +0.3% · +5.6% · The cleanest core read

Fuel imports · -0.1% · -6.6% · +26.8% · Down 10.2% over three months

All exports · +0.6% · -1.4% · +8.6% · Exports outpacing imports on the year

Agricultural exports · +0.5% · +0.4% · +5.8% · Biggest annual rise since December 2022

Nonagricultural exports · +0.7% · -1.6% · +8.9% · Petroleum and nonferrous metals drove it

Import categories by end use, with their weight in the basket:

Category · Weight · Aug m/m · y/y · Read

Capital goods · 31.14% · +0.9% · +7.3% · Largest category, and accelerating

Consumer goods excluding automotives · 24.36% · +0.5% · +2.4% · Subdued; little shelf-price pressure yet

Industrial supplies and materials · 23.54% · +1.2% · +17.5% · Includes fuel

Automotive vehicles, parts and engines · 14.25% · 0.0% · +0.8% · Flat on both horizons

Fuels and lubricants · 9.00% · -0.1% · +26.8% · Falling monthly, still extreme annually

Foods, feeds and beverages · 6.71% · +0.1% · +3.0% · Quiet

Industrial supplies excluding fuels · 14.53% · +2.0% · +12.6% · The hottest nonfuel line in the report

Nonelectrical machinery · 24.74% · +1.2% · +9.0% · Inside capital goods; the AI hardware channel

The sub-lines doing the work:

Line · Aug m/m · y/y · Read

Finished metals related to durable goods · +5.7% · +15.5% · Largest monthly move in the report

Nonmetals related to durable goods · +3.6% · +9.2% · Boxes, belting, glass

Unfinished metals related to durable goods · 0.0% · +26.7% · Flat on the month, extreme on the year

Natural gas · -1.0% · +102.6% · More than doubled in twelve months

Petroleum and petroleum products · +0.1% · +27.3% · The annual number is the live one

Crude petroleum · -3.4% · +22.0% · August data; WTI has since settled above $105

Import air freight · +1.8% · +27.0% · Logistics costs still compounding

Import air passenger fares · -11.2% · +13.2% · Largest monthly drop since July 2025

Import prices by locality of origin, which is where the tariff and currency story lives:

Origin · Aug m/m · y/y · Read

United Kingdom · +3.9% · +5.0% · Largest monthly move of any locality

Asian newly industrialized economies · +3.0% · +12.6% · The regional hardware complex

Taiwan · +1.9% · +8.7% · Semiconductors, and it shows

Pacific Rim · +1.4% · +6.5% · Broad regional pressure

China · +1.0% · +3.0% · Record monthly rise since the index began in 2004

European Union · +0.9% · +4.1% · Germany -0.3%, France -0.5%

Industrialized countries · +0.3% · +7.5% · Dragged up by Canadian energy

Mexico · +0.1% · +2.3% · The quietest major partner

Japan · +0.2% · +1.1% · Lowest annual rate of any named partner

Canada · -0.8% · +14.2% · Nonmanufacturing, mostly energy, fell 3.1%

Terms of trade, and what they say about who is absorbing what:

Partner · Aug change · Read

China · -2.1% · Paying more for imports, receiving less for exports

Japan · -0.5% · Modest deterioration

European Union · -0.4% · After a 1.8% fall in July

Canada · +2.4% · Cheaper Canadian energy, dearer US exports

Mexico · +1.1% · Improving

Where The Price Pressure Came From

Start with the category that carries the most weight. Capital goods are 31.1% of the import basket — nearly a third of everything the US buys from abroad by 2024 trade value — and they rose 0.9% on the month and 7.3% on the year. Nonelectrical machinery inside that is up 9.0% annually. The BLS names computers, peripherals and semiconductors first among the drivers. This is the AI build-out passing through the border, and it is the most consequential line in the release for anyone modeling corporate input costs.

The metals complex is the tariff signature. Finished metals related to durable goods rose 5.7% in one month — the single largest monthly move anywhere in this report — and are up 15.5% on the year. Unfinished metals sit at +26.7% annually. Nonfuel industrial supplies overall rose 2.0% on the month and 12.6% on the year. Section 232 steel and aluminum duties have been cited by name in ISM commentary for months, and this is the price series where they land first.

China is the structural story, and the level matters more than the change. A 1.0% monthly rise is a record for the series, but the index sits at 99.9 against a December 2003 base of 100. Twenty-two years of Chinese imports arriving at a flat-to-falling dollar price is a large part of why US goods inflation was quiescent for two decades. That does not end with one month. But the record is the record, and the driver — computer and electronic product manufacturing — is the same complex pushing capital goods up.

Canada is the counterweight, and it is entirely energy. Import prices from Canada fell 0.8% on the month, but the split is stark: nonmanufacturing fell 3.1% while manufacturing rose 0.4%. On the year, Canadian nonmanufacturing imports are +24.2% against manufacturing at +9.8%. Canada's contribution to US import inflation is an oil and gas contribution, and in August it went into reverse — which is exactly what you would expect from an index priced before September's crude surge.

Europe splits in an interesting way. The EU aggregate rose 0.9%, but Germany fell 0.3% and France fell 0.5%, while the United Kingdom rose 3.9% — the largest monthly move of any locality in the table, and one that has nothing to do with China or tariffs.

Consumer goods remain the missing piece. Excluding automotives they rose 0.5% on the month and 2.4% on the year; manufactured nondurables +2.6% y/y, manufactured durables +2.2%. Autos were flat outright. The pressure in this release is concentrated in what businesses buy, not what households buy — which is why it reads as a producer-cost signal rather than a CPI signal, at least this month.

One note on services, which usually get ignored. Import air freight prices rose 1.8% on the month and 27.0% on the year, and export air freight is +18.1% annually, the most since September 2022. Air passenger fares moved the other way: import fares fell 11.2%, the largest monthly drop since July 2025, though still +13.2% on the year. Freight compounding at 27% while passenger fares fall is a demand mix worth watching.

Against This Morning's Open

This release is absent from The Open's calendar, as was retail sales — two 08:30 prints missing from the same table — The Open, which lists NAHB at 10:00, the FOMC at 14:00 and the press conference at 14:30.
In fairness, this one would not have been the session's fulcrum even if tabled. Import prices rarely move an instrument, and on a decision day they move nothing. The point is the completeness of the list, not the ranking within it.
The Open's actual read on the day holds up. It argued the hike is close to fully priced, so the dot plot and the vote count are what matter at 14:00. Imported inflation at a four-year high only stiffens the hawkish side of both.
And its framing of the energy picture is directly relevant here. The Open flagged the unresolved Saudi supply story and WTI's $105.83 settle. This release is August data and already shows fuel falling; the September version will not.

What This Sets Up

Next release — Friday 16 October at 08:30 ET, covering September, which will be the first month to price the Saudi supply disruption and crude above $100 at the border.
Whether the China index follows through. One record month is an event; two consecutive monthly rises above 0.5% would be a genuine break in the twenty-two-year pattern, and the thing to check is whether the driver stays concentrated in computer and electronic product manufacturing.
Whether nonfuel keeps outrunning fuel. Nonfuel at +5.5% y/y is the highest since May 2022 and is now the engine of the headline. If fuel re-accelerates in September while nonfuel holds, the annual rate goes higher from both ends at once.
Whether any of it reaches consumer goods. Consumer goods excluding autos are up just 2.4% on the year. That line is the bridge between this release and CPI, and so far it has not been crossed.
The terms of trade with China. Down 2.1% in August and 0.7% in July. A third consecutive monthly deterioration would make this a trend in the trade data rather than a pair of months.

What Is This?

What it is: The US Import and Export Price Indexes, published monthly by the Bureau of Labor Statistics, measure the change in prices of goods and services traded across the US border, priced in dollars. Unlike CPI or PPI, these are not domestic prices — they are what US buyers actually pay foreign sellers and what foreign buyers pay US sellers, before tariffs and transport are layered on top. The release breaks out imports by end-use category, by locality of origin, and for a handful of services such as air freight and passenger fares, and publishes a terms-of-trade index measuring the purchasing power of exports relative to imports. August's release is dated 16 September 2026; the September edition is scheduled for 16 October.
Why it matters: It is the earliest read on inflation entering the country from outside, which makes it a leading indicator for the goods side of CPI and PPI. Right now it carries unusual weight for two reasons. Tariffs have been in force since April 2025 with Section 232 steel and aluminum duties on top, and this is the series that shows whether foreign sellers are cutting their prices to absorb them or holding firm and passing them on. And the AI build-out is import-intensive: capital goods are 31% of the basket, so what happens to computer and semiconductor prices at the border feeds directly into US corporate capex costs.
How to read it: Four cautions. Import prices exclude duties — the index measures the price charged by the foreign seller, not the landed cost after tariffs, so a flat index can coexist with a sharply higher cost to the US importer. Fuel dominates the headline and swings it hard in both directions, which is why the nonfuel series is the one to read for underlying pressure. The locality indexes have different base periods — China is December 2003 = 100, Taiwan December 2018 = 100 — so their levels are not comparable to each other, only their changes. And the data are revised in each of the three months after first publication, so a single month's move, however striking, should be treated as provisional.

Want the full explainer? Economic News Events, Explained breaks down this release and every other one we cover, in plain English.

_For informational purposes only. Not investment advice._