By  on September 17, 2009

WASHINGTON — Retail apparel prices declined a seasonally adjusted 0.1 percent in August compared with July, but increased 0.6 percent year-over-year, the Labor Department said Wednesday in its Consumer Price Index.

Women’s apparel prices fell 1.3 percent in August and declined 1 percent compared with a year earlier. Men’s apparel prices increased 0.3 percent in August, but dropped 1 percent in 12-month comparisons.

August retail prices allayed some fears that most retailers would be forced into discounting to survive, said John Lonski, economist with Moody’s Investor Services.

“Apparel prices have proven to be resilient given the depth of the recession,” Lonski said. “It’s not clear that retailers are under intense pressure to discount prices for the purpose of getting rid of unwanted inventories.”

There was some good news in August, with better than expected retail sales results reported on Tuesday and effective inventory management also had an impact, Lonski said.

However, not every apparel category was able to avoid discounting. More fall and winter women’s merchandise than was typical hit the racks already discounted, which lead to a drop in prices for many items, said Malinda Harrell, an economist with the Labor Department.

The overall CPI rose 0.4 percent in August, but dropped 1.5 percent compared with a year earlier. The so-called core index, which excludes the volatile food and energy sectors, increased 0.1 percent for the month and advanced 1.4 percent compared with August last year.

“The steepest CPI declines are now behind us,” said Nigel Gault, chief U.S. economist for IHS Global Insight.

The back-to-school season did help drive girls’ and boys’ retail apparel prices up as merchandise hit store floors at full price, Harrell said. Girls’ apparel prices increased 5.1 percent in August and advanced 3.8 percent year-to-year. Boys’ apparel prices rose 2.3 percent in August and spiked 7 percent compared with a year earlier.

Women’s outerwear prices fell 6.5 percent in August and 7.6 percent compared with a year earlier. Retail prices for dresses declined 2.2 percent month-to-month, but increased 6.7 percent in 12-month comparisons. Women’s suits and separates saw prices decline 0.3 percent in August and 2.4 percent compared with a year earlier.

Retail prices for men’s suits, sport coats and outerwear increased 2.2 percent in August, but dropped 5.8 percent compared with a year earlier. Men’s furnishings prices declined 0.6 percent month-to-month, but rose 2.3 percent in 12-month comparisons. Retail prices for men’s shirts and sweaters were up 0.8 percent in the month 0.1 percent year-to-year.

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