Import prices are sky-high. Why?

U.S. import prices rose sharply in February, signaling broader cost pressures amid cold weather, a weaker dollar, and looming tariffs, with the recent war adding fuel to inflation worries. The episode also covers small business strains from rising transport and input costs, a stalling housing market due to climbing mortgage rates, jeweler challenges from volatile metals prices, and lighter trends in sports viewing and "sleepcations."

Import Prices Jump, Inflation Risks Rise

February import prices increased 1.3%, beating expectations and marking the largest monthly gain since March 2022; year-over-year, they also rose 1.3%. Economists like Orrin Klatchkin at Nationwide note this data precedes tariffs but captures secondary effects: tariff uncertainty weakened the dollar, making imports costlier. A cold winter drove fuel import prices up 3.8%, rippling into other goods—fuel is needed to produce and ship items like apples from Canada or New Zealand. The data predates the war, with crude now above $90/barrel. Trade policy professor Ishwar Prasad at Cornell says firms increasingly pass costs to consumers, potentially fueling inflation. Klatchkin revised his Q2 headline CPI forecast from 2.8% to 4.3%, though a one-time jump is hoped for.