WASHINGTON — Retail apparel prices fell 1.1 percent in September, driven by a dramatic drop in women’s apparel prices, as inflationary pressures waned for the first time in several months, the U.S. Labor Department’s Consumer Price Index showed Wednesday.
It was the largest seasonally adjusted monthly decline in retail apparel prices in 13 years, according to Sarah Hutchinson, an economist at the Labor Department. But on an annual basis, retail apparel prices were still 3.5 percent higher.
Women’s retail apparel prices fell a seasonally adjusted 2.7 percent in September compared with August, but were 2.5 percent above September 2010. Men’s apparel prices fell 0.8 percent, but were 3.5 percent higher than a year earlier.
Within the women’s apparel category, retail prices for outerwear fell 6.7 percent, the largest decline since March 2008, when prices fell 3.8 percent, Hutchinson said. Dress prices declined 5 percent in September compared with August, while prices for suits and separates dropped 1.7 percent. In men’s wear, prices on suits, sport coats and outerwear fell 2.8 percent for the month, while prices on pants and shorts dipped 1.1 percent.
Economists said retailers have been able to sustain strong pricing power for the past several months, passing on higher cotton prices and other raw material costs to consumers, but that power weakened in September.
“A lot of apparel outlets are feeling the pressure and can’t increase prices,” said Chris G. Christopher Jr., senior principal economist at IHS Global Insight.
John Lonski, chief economist at Moody’s Capital Markets Group, called September “pay-back time” for retailers that have had what he called a “very strong run” of price increases.
Lonski said the CPI index for apparel prices increased 3.6 percent in the third quarter compared with a year earlier, marking the steepest quarterly gain since 1991.
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