Import prices have started to tumble, thanks to the strong dollar.

Why it matters: The decline shows one channel through which the Fed's rate hikes — the key reason for the recent strength in the greenback — can tamp down inflation.

Driving the news: Fresh government data on Thursday showed import prices fell sharply for the second straight month in August.

Between the lines: The drop in import prices is really just the flip side of the runaway strength of the U.S. dollar.

How it works: When currencies appreciate it means that money is able to buy more foreign goods than it used to, or buy the same amount at a lower price. Thus, in this case, import prices are lower in dollar terms.

The bottom line: The decline in import prices — which have become a larger factor in driving overall inflation since COVID hit — should at least be helpful on the margin to the Fed's effort to rein in inflation.