By and and  on December 16, 2009

WASHINGTON — Retail apparel prices declined a seasonally adjusted 0.3 percent in November but rose 1 percent versus a year ago, the Labor Department said Wednesday in its Consumer Price Index.

Investors were unmoved by the CPI figures or the Federal Reserve’s decision to keep the federal funds interest rate in its current range of zero to 0.25 percent. The S&P Retail Index was down 0.4 percent, or 1.51 points, to 409.96, and the Dow Jones Industrial Average slid 0.1 percent, or 10.88 points, to 10,441.12.

Women’s apparel prices dropped 0.3 percent month-to-month and increased 1.3 percent year-over-year. Men’s apparel prices fell 0.7 percent and decreased 0.6 percent compared with November 2008.

“It’s a difficult pricing environment, that’s what we’re picking up from the holiday shopping season,” said John Lonski, chief economist at Moody’s Investors Services.

Some retailers discounted early in November to encourage purchasing, but that could prove to be a problem if consumers expect lower prices throughout the holiday season, he said.

The overall CPI rose 0.4 percent month-to-month and advanced 1.8 percent in 12-month comparisons, driven by a jump in fuel prices. The so-called core index, which excludes the volatile food and energy sectors, was flat month-to-month and rose 1.7 percent compared with a year earlier.

Apparel prices continued to decline in most categories in November. Women’s dresses dropped 1.2 percent and fell 0.4 percent compared with a year earlier. Women’s suits and separates slid 0.2 percent, but rose 0.5 percent compared with November 2008. The broad women’s underwear, nightwear, sportswear and accessories category fell 1.3 percent in November but advanced 4.5 percent year-over-year. Women’s outerwear prices rose 1.9 percent, but declined 1.1 percent in 12-month comparisons.

Men’s suits, sport coats and outerwear prices decreased 2 percent in November and fell 4.5 percent compared with a year earlier. Shirts and sweaters fell 0.6 percent and declined 1 percent year-over-year. Pants and shorts were down 1 percent and fell 0.8 percent in 12-month comparisons. Prices for men’s furnishings rose 0.9 percent, and advanced 3.1 percent compared with a year earlier.

Girls’ apparel prices were down 3.6 percent month-to-month and fell 1.8 percent year-to-year. Boys’ apparel prices declined 1.2 percent, and decreased 0.3 percent compared with the same period last year.

The Fed, led by chairman Ben Bernanke — picked as Time magazine’s Person of the Year — said inflation would remain “subdued for some time.” Although the federal funds rate, which influences how much it costs consumers and businesses to borrow money, wasn’t changed on Wednesday, it is expected to migrate higher as the economy strengthens and inflation becomes a concern.

The Fed’s open market committee said “economic activity has continued to pick up” and “the deterioration in the labor market is abating,” but added businesses are still cutting back and are “reluctant” to hire.

Among the day’s decliners on Wall Street was G-III Apparel Group, which laid out plans to sell an additional 1.7 million shares to the public and as many as 255,000 shares to its underwriters, raising as much as $38 million for general corporate purposes and, potentially, acquisitions. But at $19.50 a share, the offer represented a discount of 8.2 percent from G-III’s Tuesday close of $21.25. Shares of the firm, which produces under its own brands as well as under licenses from Calvin Klein, Sean John, Kenneth Cole and others, fell 7.9 percent to $19.57.

Mall operator General Growth Properties Inc. said late Tuesday that it received bankruptcy court approval of its reorganization plan. The real estate investment trust worked out a deal to restructure 87 secured mortgage loans totaling $10.25 billion, and the payment in full of all undisputed claims of creditors. General Growth, which filed for Chapter 11 protection in April, hopes to exit bankruptcy proceedings by yearend. Shares slumped 10.4 percent to $8.81 Wednesday.

Published reports indicated that Iconix Brand Group Inc. was abandoning its pursuit of Playboy Enterprises Inc. because of the integration problems that would follow an acquisition. Iconix shares rose 3 percent to $12.34 while Playboy’s slid 9.9 percent to $3.46.

European markets firmed — with the CAC 40 in Paris advancing 1.1 percent to 3,875.82 and London’s FTSE 100 ahead 0.7 percent to 5,320.26. In Asia, Japan’s Nikkei 225 rose 0.9 percent to 10,177.41 while the Hang Seng Index in Hong Kong fell at the same rate to 21,611.74.

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