U.S. import and export prices fell for the fifth consecutive month in December as costs for oil and many non-petroleum products declined, and U.S. businesses cut inventories in November by the biggest amount in seven years as they tried to deal with a record drop in sales, the government reported Wednesday. Import prices fell a smaller-than-expected 4.2 percent in December after falling by 7 percent the previous month, the Labor Department said. Over the past 12 months, import prices have tumbled a record 9.3 percent as global economic strife has weakened business and consumer demand. Petroleum import prices fell 21.4 percent last month, which also was the fifth consecutive monthly decline, after dropping by 28.5 percent in November. In the fourth quarter of 2008, petroleum import prices fell 56.2 percent, the biggest quarterly decline since the department started tracking such data in 1982. Non-petroleum import prices fell 1.1 percent in December, while prices for consumer goods excluding autos rose 0.1 percent. Over the 12 months, consumer-goods import prices have risen 2.2 percent, the biggest increase since 1996. Prices for U.S. exports fell 2.3 percent in December, led by sharper drops in export prices for agricultural goods, food, and industrial supplies. Export prices fell 3.2 percent in 2008, the biggest 12-month decline since late 1998. Meanwhile, the Commerce Department reported that business inventories fell a bigger-than-expected 0.7 percent in November, the third consecutive month that businesses have reduced their stockpiles. It has been the longest such period of declines since four consecutive months of reductions that ended in August 2003. November's big drop in inventories reflected a record 5.1 percent decline in total business sales. October sales fell 3.9 percent.
