WASHINGTON — Wholesale prices for domestically produced women’s apparel in January dipped 0.2 percent against December, as producer prices for U.S.-made textiles inched up 0.4 percent, the Labor Department reported Thursday in its monthly Producer Price Index.
This story first appeared in the February 21, 2003 issue of WWD. Subscribe Today.
Compared to January 2002, wholesale women’s apparel prices fell 1.5 percent.
Meanwhile, wholesale prices for all finished goods for the month jumped 1.6 percent — the largest leap in 13 years — but economists blamed most of the surge on a 4.8 percent increase in energy prices, along with a 1.6 percent climb in food prices, and said inflation isn’t creeping into the economy.
However, when these two volatile commodities are removed from the index, wholesale prices last month still rose 0.9 percent, the largest gain in the core inflation index since December 1998, when it increased 1 percent.
“This number simply reflects a little bit of an increase in what has been a real tough, no-pricing-power or price-decline scenario,” said Andrew Hodge, senior vice president with Global Insights Inc.
The PPI is considered a measure of inflation, as is the Consumer Price Index released today by the government.
Charles W. McMillion, chief economist at MBG Information Services, said the slow economy and competition from low-priced imports keeps domestic manufacturers under extreme pressure to keep prices down.
Compared to January 2002, U.S.-made textile prices dipped 0.3 percent and apparel prices were unchanged. McMillion said wholesale textile and apparel prices might actually be lower than the government is reporting, since the industries began discounting early in 2002, leaving little left for January sales.
However, McMillion said U.S. textile and apparel prices “have held up” fairly well over the last year, especially in light of the 25 percent excess factory capacity for textiles and 33 percent for apparel, as reported by the Federal Reserve Board. In addition, domestic apparel production in January was down 4 percent for the year, but up 1 percent against January, as textile production declined 0.6 percent for the year and fell 1.2 percent for the month.
Among the categories of women’s apparel tracked by the government with notable wholesale price fluctuations, women’s sheer hosiery declined 2.8 percent for the year and fell 2.3 percent for the month. Producer prices for women’s sweaters, jackets and jerseys plunged 13.2 percent over the year and were unchanged in January against December. Skirt prices increased 3.8 percent year to year and were up 0.2 percent for the month.