Import Prices Surge 1.9%, Export Prices Jump 3.3% in April — Pipeline Inflation Is Getting Worse, Not Better
New government data released May 14 shows import and export prices spiked at rates not seen since 2022, driven almost entirely by Iran-war fuel costs. Retail sales technically grew 0.5% in April — but strip out gasoline stations and consumers are barely spending. Treasury Secretary Scott Bessent is calling it 'transitory.' We've heard that before.
The Numbers Behind the Headlines While last week's CPI number grabbed the headlines, the Bureau of Labor Statistics released something significant Thursday morning: import prices jumped 1.9% in April alone , following a 0.9% rise in March. Export prices surged 3.3% — the biggest monthly move since early 2022, according to the BLS official release. Year-over-year, import prices are up 4.2% — the largest 12-month advance since October 2022. Fuel imports led the charge. Import prices for fuels and lubricants exploded 16.3% in a single month , the largest monthly jump since March 2022, per BLS. Import petroleum specifically: up 19% in April. Retail Sales: The Headline Looks Fine. The Reality Doesn't. April retail sales came in at +0.5% month-over-month , right on forecast, according to the U.S. Census Bureau via Trading Economics. Sounds decent. Gasoline stations accounted for the single biggest gain — up 2.8% for the month. Gasoline station sales are up 15.5% over the previous period . That's not consumer confidence. That's people paying more at the pump because they have no choice. Strip out gas stations and retail sales rose just 0.3% . Furniture stores fell 2% . Clothing dropped 1.5% . Auto dealers slid 0.5% . Consumers are not on a spending spree — they're being squeezed at the gas station and cutting back everywhere else. Retail sales data is NOT adjusted for inflation . So that 0.5% "gain" likely represents consumers buying LESS stuff at HIGHER prices. Bessent Says "Trust Me" — We've Heard That Before Treasury Secretary Scott Bessent went on CNBC Thursday and told Joe Kernen he expects "one or two more hot inflation numbers" before "substantial disinflation" kicks in. He predicted U.S. oil production will keep pumping, easing the Iran-driven energy shock. "I firmly believe that nothing is more transient than a supply shock," Bessent said. That word — "transient" — echoes what former Fed Chair Jerome Powell said in 2021 when he called that inflation surge "transitory." Powell was catastrophically wrong. Inflation went on to hit 9.1% by June 2022. Bessent was careful to distance himself: "I was never on team transitory during Covid." But he's now betting that a supply shock from an active war with Iran will self-correct soon. That's a bold call with real consequences for real people's grocery bills. The Pipeline Is Stuffed With Inflation Import prices rise. Producers pay more. Wholesale prices spike. Consumer prices follow. Wholesale prices (the Producer Price Index) already came in at +1.4% for April , putting the year-over-year rate at 6.0% — the highest since late 2022, according to the BLS. Services rose 1.2%. Goods rose 2.0%. Gasoline in that index: up 15.6% . Nonfuel import prices — the stuff that ISN'T energy — rose 0.8% in April and are up 2.9% year-over-year . Capital goods. Consumer goods. Industrial materials. All moving higher, per BLS. Energy is the loudest signal, but the underlying pressure is spreading. The Fed Transition Adds a Wild Card Jerome Powell's term ended Friday . Kevin Warsh was confirmed by the Senate Wednesday and is stepping in as the new Fed chair. Bessent suggested to CNBC that the "Warsh Fed" will help with the timing. Meanwhile, prediction markets on Kalshi and Polymarket have odds of a Fed pause in June sitting above 96% , according to ts2.tech. The real question is whether Warsh — who has previously criticized Fed independence and is seen as more aligned with the Trump White House — will hold the line on rates when political pressure to cut inevitably builds. What's Actually Happening Most outlets are running the retail sales number at face value — "consumers resilient, spending continues." When the only category driving growth is gasoline because a war spiked fuel prices, that framing is misleading. The import and export price numbers are getting buried beneath the retail sales headline. Import prices up 1.9% in ONE month means businesses importing goods — which is most of American retail — are paying significantly more. Those costs will pass through to consumers. The only question is when. Gas will stay expensive as long as Iran remains a hot conflict. The goods you buy are quietly getting more expensive even before Iran-shock costs fully filter through. Bessent may be right that this eventually cools — but "eventually" doesn't help you at the checkout line this week. The pipeline is full. The pressure is real. And the new Fed chair walks into a situation where cutting rates risks re-igniting inflation and holding rates risks cracking an economy already showing stress in furniture, clothing, and autos.
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