By  on October 15, 2009

WASHINGTON — Retail apparel prices rose a seasonally adjusted 0.1 percent in September compared with August and advanced 1.1 percent against a year earlier, the U.S. Labor Department said Thursday.

But even with signs that stores generally held prices, stocks in the sector retreated. The S&P Retail Index fell 0.5 percent, or 1.89 points, to 396. The Dow Jones Industrial Average inched up 0.5 percent, or 47.08 points, to 10,062.94 after passing the 10,000 mark for the first time in more than a year Wednesday.

“Retailers are going to great lengths to avoid being stuck with excessive inventory,” said John Lonski, chief economist at Moody’s Investors Service. “[They] are heeding the readings of a sluggish economy.”

With tightly managed inventory, discounting pressures lessen, Lonski said, helping to stabilize apparel prices.

Women’s apparel prices increased 0.1 percent last month, but fell 0.2 percent compared with September 2008. Men’s apparel prices declined 0.3 percent month-to-month and 0.9 percent year-over-year.

Economists said price trends have not indicated a threat of deflation or inflation. Retail apparel prices declined 0.1 percent in August compared with the previous month after rising 0.6 percent and 0.7 percent in July and June, respectively.

Despite a handful of hopeful signs, including lower jobless claims last week and recent advances in the equity markets, retailers and consumers continue to be cautious and will remain so until the employment picture and credit outlook improve substantially, Lonski said. Retailers are likely to continue to keep a tight rein on inventories moving into the holidays, he said.

Prices for all consumer goods rose 0.2 percent in September, in line with economists’ expectations, but dropped 1.3 percent year-over-year. The core CPI, which excludes the volatile food and energy sectors, advanced 0.2 percent, slightly higher than expectations of a 0.1 percent rise. Core prices advanced 1.5 percent compared with a year earlier.

Boys’ apparel prices declined 3 percent in September, but rose 4.6 percent compared with a year earlier. Girls’ apparel prices rose 1.1 percent month-to-month and 5 percent year-over-year.

Women’s outerwear prices spiked 5.8 percent in September, but fell 3.2 percent over the 12 months. Dress prices fell 5.5 percent month-to-month, but rose 0.2 percent year-to-year. Prices for women’s suits and separates declined 0.6 percent in September and 1.1 percent in 12-month comparisons. The broad women’s underwear, nightwear, sportswear and accessories category saw prices advance 2.6 percent for the month and 2.8 percent year-over-year.

Men’s suits, sport coats and outerwear prices increased 0.5 percent month-to-month, but declined 7 percent compared with a year earlier. Prices for furnishings rose 0.2 percent in September and 1.5 percent in 12-month comparisons. Men’s shirts and sweaters saw prices drop 0.9 percent in monthly comparisons, but were up 1.1 percent for the year. Prices for men’s pants and shorts declined 1.7 percent in September and 0.8 percent compared with a year earlier.

Separately in Washington Thursday, the Obama administration did not label China a currency manipulator in the second of two reports the Treasury Department submits to Congress each year detailing exchange rate policies. According to the report, the Treasury determined that China’s currency is undervalued, but stopped short of accusing the government of manipulating the yuan. But the report said the administration had “serious concerns” about the rigidity of the yuan’s exchange rate and about China’s resumption of its practice of accumulating foreign exchange reserves. Since February, the yuan has depreciated 6.9 percent, according to the Treasury report.

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