US import prices dropped for a second straight month in August, weighed down by decreasing costs for petroleum products and a strong dollar. On Thursday, Labour Department said that import prices fell 1.0 per cent last month after declining 1.5 per cent in July.

In the twelve months through August, import prices grew 7.8 per cent after ascending 8.7 per cent in July. Reportedly, a second monthly decline in producer prices in August and weak import prices should further quench fears of inflation becoming entrenched.

Earlier this week, the government reported an unexpected upsurge in consumer prices in August, which cemented expectations for a third 75 basis points (BP) interest rate hike from the Federal Reserve next Wednesday. The fall in import prices also suggests an easing of bottlenecks in the global supply chain. Imported fuel prices tumbled 6.8 per cent last month after declining 7.5 per cent in July. Petroleum prices dipped 7.1 per cent, while the cost of imported food fell 1.6 per cent. Excluding fuel and food, import prices declined 0.1 per cent.