WASHINGTON -- Retail prices for all apparel in December dropped 3.2 percent year-over-year, marking the sharpest 12-month decline since 1952, the Labor Department reported Wednesday.
Analysts expect the deflation in prices to persist this year, as imports continue to squeeze prices, consumer confidence remains unstable and the general recession exacerbates the uncertainty.
"You've got China coming into the World Trade Organization over the next couple of years, the lifting of apparel and textile quotas and a strong U.S. dollar," said Carl Steidtman, chief economist at Deloitte Research. "All of those suggest falling prices for apparel."
A Labor Department analyst said: "The first thing that happens whenever there are concerns about the economy is people stop buying clothes+and stores begin panic markdowns. If this had been a normal year, maybe the declines in December would have been much smaller, but the November markdowns didn't have the effect retailers needed."
Apparel retail prices fell 0.6 percent in December against November, which continued the year's trend of declines. Deflationary pressures also continued in women's apparel prices, which fell 0.2 percent in December and plunged 4 percent year-over-year.
"In six of the last eight years [1994, '96, '98, '99, 2000 and 2001], prices have fallen for apparel," said Steidtman. "That establishes a pattern of deflation."
Retailers started discounting in summer and continued cutting prices through fall and the holidays, according to Charles W. McMillion, chief economist at MBG Information Services.
"My expectation is that lower prices helped move merchandise before Christmas at a cost," McMillion said. "It will really hammer retailers' profit margins in the first quarter."
In the overall economy, prices for all retail goods declined 0.2 percent in December, but increased by 1.6 year-over-year.
In the women's apparel categories tracked by Labor, retail prices for suits and separates fell 4.9 percent in December and plunged 5.8 percent year-over-year. Outerwear prices fell 1.5 percent in December and plummeted 7 percent against December 2000. Women's dress prices bucked the trend and edged up by 1 percent in December and increased 3.4 percent year-over-year.
Meanwhile, prices for underwear, nightwear, sportswear and accessories fell 0.8 percent last month and dropped 3.1 percent for the year. Girls' apparel prices remained unchanged last month, but declined 4.8 percent against the year-ago period.
@chanel and @pharrell dropped what’s being dubbed as the world’s most exclusive sneakers yesterday. The Adidas Originals NMD Hu, which Williams designed in collaboration with Chanel and @adidasoriginals, has a waiting list of over 120K people who pre-registered online at chanelatcolette.fr –– and only 500 pairs are on sale. The singer predicted the resale value of the shoes could reach $40K. Read the full interview on WWD.com. Link in bio. #wwdfashion (📷: Dominique Maître)
@imanshumpert is diving deeper into his creative endeavors and relaunching his clothing line, Post 90s, and is helping to raise money for the hurricane victims in St. Maarten with a jersey he’s designed with his brother. The Cleveland Cavaliers player talked to WWD about kneeling during the national anthem, working with fashion brands and how he wants to be more than an @nba player. Read the interview on WWD.com #wwdfashion (📷: George Chinese)
Not only does #TheProfit return to CNBC tonight, but @marcuslemonis has launched @shopmarcus, a new shopping and lifestyle retail experience in Aspen and Chicago, with more locations to come. The retail stores offer in-store stylists and a variety of contemporary womenswear selections.
“It’s life, I’m going to face it,” @mingxi11 sighed. “I fell, but you know, I think the most important thing is that I get back up. I had the love, the help from my sister — the girl next to me Gizele [Oliveira] — she’s so nice. When I went backstage everybody was trying to comfort me like ‘Oh Ming, it’s OK.’ I’m really, really touched. I think it’s them who gave me the courage to go back on stage for the finale,” Xi told WWD of her fall at the @victoriassecret fashion show. (📷: David Fisher) #wwdfashion #vsfashionshow #victoriassecret
@louisvuitton tapped @therealpeterlindbergh for its latest city-centric photo book, which is part of a series called Fashion Eye. The primarily black and white book captures the spirit of Berlin in 57 images shot between 1989 and 2019. “Berlin is an inspiration for me, more than a city. I mean @millajovovich is simply Berlin!” said Lindbergh. #wwdfashion
“You know, I think audiences expect a certain performance so I have to deliver to them what they’re expecting to a certain degree. But I’m also a different actor and a different person, I have my own spin on the character,” says @noahegalvin of his takeover of the leading role in “Dear Evan Hansen” following the departure of @bensplatt, who originated the role. Read WWD’s interview with the 23-year-old actor on WWD.com #wwdeye (📷: @jilliansollazzo)
For pre-fall 2018, @etro created richly-colored wonderland, using tapestries, textiles and wallpapers from the Eastern world at large. The line featured floral and graphic prints and jacquard motifs, like this two-piece look featured here. #wwdfashion (📷: Giovanna Pavesi)
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)