Import prices

Import prices
The import prices index follows the decrease or increase in the costs paid for the products that are imported to the hosting country. The figure is significant in terms of balance of trade. Trade balance signifies the dissimilarity between imports and exports. Balance of trade is a major composition of the existing account of the country which maintains a record of the capital flow in and outside the country. For instance, consider the country X and Y in the role of trading partner. If the exports of the country X cross the imports, it is regarded as trade surplus. In this situation, he demand for $x is more than the Country Y would want to exchange $Y for $X in order to buy products from Country X. Measuring the changes in import costs permit the participants of the market for measuring the trade balance of the country. By realizing the changes in the prices of import one can find if,for instancea raise in the balance of trade is an effect of a raise in the import volume or a raise in the import costs. The announcement of import costs, however, does not have weight in influencing the market.