By  on December 21, 2005

WASHINGTON — Wholesale prices on domestically produced women's and girls' apparel rose a seasonally adjusted 0.3 percent in November, but were still 0.1 percent below year-ago levels, according to the Labor Department's Producer Price Index, released Tuesday.

Across the economy, prices on all goods fell 0.7 percent for the month — the most since April 2003 — erasing the 0.7 percent increase in October, which was driven by higher fuel prices. Stripping away food and energy products, prices increased 0.1 percent in November, indicating that inflation remains in check.

Also giving a boost to the economic outlook, the Commerce Department reported that housing starts last month went up 5.3 percent, to a seasonally adjusted annualized rate of 2.1 million units.

"The U.S. economy is in a very good place right now," said Kristin Diver, assistant director of the Economic Forecasting Center at Georgia State University.

"The consumer is probably going to continue to show pretty strong consumption," she said. "This will continue the momentum for [gross domestic product], even though GDP next year will probably be lower than it was this year."

Higher heating bills over the winter might restrain low-income consumers, but won't hurt the broader economy, she said.

"For the average household, it's not going to be too much of a problem," she said. "For the majority, it will be annoying. It will take away perhaps poker and beer money, but not much more than that."

That pullback might also impact apparel spending, but "just slightly," Diver said.

Within the women's and girls' category, prices on knit shirts and blouses increased 3 percent from a year earlier, while dresses slid 2.6 percent and jeans and slacks sold for 1.8 percent less at wholesale.

"Producers still don't have much pricing power, but they seem to be regaining a little," said Charles McMillion, president and chief economist at MBG Information Services.

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