ByJohn S. McClenahen Driven down by falling petroleum prices -- something that seems unlikely to continue -- the U.S. Labor Department's Import Price Index fell a full percentage point in November, the index's first monthly decline since June and just the second during 2002. The petroleum index, which has risen in nine of the previous 10 months, decreased 10% in November. On the flip side of U.S. trade prices, the department's Export Price Index rose 0.1% in November, following a 0.1% decline in October. In November, a substantial upturn in prices for soybeans and other agricultural exports more than offset a decrease in nonagricultural exports generally. The export price index for capital goods did rise 0.1% in November, however, its first increase since April. Capital goods constitute about 48% of U.S. exports. Meanwhile, the current account balance, a broad measure of U.S. international transactions, showed little change between this year's second and third calendar quarters, says the U.S. Commerce Department. The U.S. ran a current account deficit of $127 billion with the rest of the world between July and September, only slightly less than the second quarter's $127.6 billion. Deterioration of U.S. trade in goods and services, one of three measures included in the current account, was more pronounced. The deficit increased to $110.9 billion in the third quarter from $109.3 billion in the second quarter, as imports of goods and services outstripped exports. The overall U.S. current account deficit remains above $500 billion or close to 5% of GDP, notes Maury Harris, chief U.S. economist at UBS Warburg LLC, New York. "In any other nation, this level would be regarded as unacceptable," he says. "However, with growth lagging in other developed regions, including Europe and Japan, the U.S. appears likely to continue to defy history."
