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Producer Prices Rise in Sept.

WASHINGTON — Wholesale prices for domestically produced women’s apparel edged up slightly by 0.1 percent in September but continued to decline on an annual basis, the Labor Department reported Friday in its Producer Price...

WASHINGTON — Wholesale prices for domestically produced women’s apparel edged up slightly by 0.1 percent in September but continued to decline on an annual basis, the Labor Department reported Friday in its Producer Price Index.

This story first appeared in the October 15, 2002 issue of WWD.  Subscribe Today.

Compared to September 2001, women’s apparel prices at the producer level fell 2.2 percent last month.

Wholesale prices for all U.S.-produced apparel rose 0.1 percent in September against August, but fell 1.5 percent from year-ago levels. Prices for girls’, children’s and infants’ apparel remained unchanged last month, but rose 1.7 percent against year-ago levels.

“I would expect some deflation given the weakness in consumer demand, excess capacity globally, and given the dollar has not fallen in relation to countries from whom we import apparel,” said Ira Kalish, chief economist at Retail Forward.

The wholesale price index for all U.S.-made goods inched up 0.1 percent in September after an unchanged index in August, revealing that inflation is not in the picture. Price declines in goods are being offset by an increase in service-sector prices.

“People are concerned about deflation and a general lack of pricing increases,” said John Mothersole, senior economist and principal at the WEFA Group. He noted the core index, which does not include volatile food and energy prices, is now “showing a sharper rate of decline.

“It all goes back to the concern that producers don’t seem to be able to generate pricing leverage and that’s a bad sign, especially if we are purportedly in the early stages of a recovery, which is when you normally see prices start to strengthen,” he said.

A majority of the women’s apparel categories tracked by the government remained unchanged last month, but there were wide wholesale price swings on a year-over-year basis.

Wholesale prices for domestically produced women’s sweaters, jerseys and jackets rose 1 percent last month, but plunged 11.5 percent against September 2001. Prices for knit sportshirts and sweatshirts remain unchanged in September, but fell 4.8 percent against year-ago levels, while producer prices for slacks, jeans and dungarees remained unchanged last month and fell 3.4 percent on an annual basis.

Prices for dresses fell 0.1 percent in September against August and dropped another 2.8 percent compared with year-ago levels.