WASHINGTON — Low-cost imports and intense competition between stores helped drive retail prices on women's apparel down 0.9 percent in 2007 as increases in energy costs pushed prices on all goods and services up 4.1 percent, well above the 2.5 percent rise in 2006 and the largest jump in 17 years.
Excluding the volatile food and energy sectors, overall retail prices jumped 2.4 percent last year, the Labor Department reported Wednesday in its Consumer Price Index.
Inflation, however, is not as much a concern for economists and federal regulators as pressures on economic expansion, including weakness in job growth and consumer spending and a credit crunch on Wall Street.
Although increased prices strain shoppers, particularly on the lowest rungs of the economic ladder, it was not higher prices that made for a weak holiday season, said Paul Nolte, director of investments at Hinsdale Associates. Total retail sales fell a seasonally adjusted 0.4 percent in December, compared with the preceding month, the Commerce Department reported this week.
Outside of the energy and food areas, where prices last year rose 17.4 percent and 4.9 percent, respectively, Nolte said inflation wasn't much of a concern.
Within the women's category, suits and separate prices fell 0.3 percent last year and outerwear prices dipped 4.9 percent. But dresses bucked the trend with a 2.7 percent rise.
Comparing December with November, women's apparel prices rose a seasonally adjusted 0.8 percent. Consumer prices across the economy were up 0.3 percent in December, after a 0.8 percent jump in November and a 0.3 percent increase in October.
The Federal Reserve Board keeps a close watch on inflation and will hike interest rates to keep it in check. But with the economy slowing, economists expect the central bank to continue to cut its benchmark federal funds interest rate, which stands at 4.25 percent.
The Fed, chaired by Ben Bernanke, meets next on Jan. 29 and 30. In addition to poring over inflation, gross domestic product estimates and other data, it will consider the results of the Beige Book, an anecdotal reading of the economy across the Fed's 12 districts that was also released on Tuesday.
Drawing on information collected from mid-November through early January, the Beige Book reported that economic activity increased modestly though at a slower pace than earlier in the year.In the Philadelphia district, apparel sales fell short of stores' expectations, especially at specialty operations, where the season was "a real disappointment," according to several of the Fed's contacts.
In the Richmond district, a North Carolina department store manager said extended store hours just before Christmas had little impact on sales. Retail wages in the district grew faster in December, even as jobs were cut.
"A department store executive in Maryland said that regular employees' hours had been 'cut to the minimum level allowed for employee benefits,' while a store manager in Virginia Beach, Va., noted that 'hours have been cut to the bone,'" said the report.
In the San Francisco district, retail sales were flat to down, and the Fed's contacts said there was early and aggressive price discounting, especially for apparel.
Harrods plans to remove the famous statue of Princess Diana and Dodi Al Fayed from the bottom of the Egyptian escalators and hand it back to Mohamed Al-Fayed. “We are very proud to have played our role in celebrating the lives of Diana, Princess of Wales and Dodi Al Fayed at Harrods and to have welcomed people from around the world to visit the memorial for the past 20 years,” said Michael Ward, Harrods managing director. “With the announcement of the new official memorial statue to Diana, Princess of Wales at Kensington Palace, we feel that the time is right to return this memorial to Mr. Al Fayed and for the public to be invited to pay their respects at the palace.” More on the news, with reporting by @loreleimarfil, at WWD.com. #wwdnews
@prada is introducing a new project at its men’s fall 2018 show this Sunday: “Prada Invites.” The fashion house invited four celebrated creative minds – @ronanaerwanbouroullec, Konstantin Grcic, @herzogdemeuron and @rem.koolhaas – to each create a unique item with its iconic nylon material. The designs will be unveiled on the runway show, which will take place at the company’s warehouse in Viale Ortles 25. #wwdfashion #mfwm (📷: @martinocarrera)
@kering_official is spinning off its stake in puma in an effort to focus on its luxury brands, the brand operator announced yesterday. “We are proud to have supported the turnaround of Puma, which now has unrivaled capabilities to take full advantage of the specific dynamics of its global markets and is poised to achieve substantial growth,” said François-Henri Pinault, Kering’s chief executive officer and chairman. Artémis will become a “long-term strategic shareholder” of Puma with a 29 percent stake. #wwdnews #wwdfashion (📷: @jilliansollazzo)
The fashion world mourns for celebrated street style photographer, Nabile Quenum, who died at age 32 in Paris.
Quenum, creator of the fashion blog “J’ai Perdu Ma Veste,” was a fashion week fixture, and regularly shot for New York magazine’s The Cut, among other outlets, and brands such as Louis Vuitton, Moncler and Adidas. He was also actively involved in the #NoFreePhotos initiative, which kicked off in the fall. Read more about Quenum in @kbsmoke's story on WWD.com. #wwdnews
@verwanggang and @maisonladuree have teamed up on a dessert collab called Vera Wang Pour Ladurée. The collection, which launched this week, features a specialty macaroon, as well as a wedding cake inspired by one of the designer’s gowns. “I could not imagine a more delicate or sophisticated creation to grace any couple’s celebration,” said Wang. #wwdfashion