WASHINGTON — Retail prices for women’s apparel rose 1.3 percent in May, marking the third consecutive monthly increase and reflecting some stabilization in pricing power, according to economists.
Compared with May 2003, women’s apparel prices last month increased 2 percent, following five years of deflationary pressures and marking a price strengthening trend, the Labor Department’s Consumer Price Index, a closely watched gauge of inflation, revealed Tuesday.
Retail prices for all apparel rose 0.3 percent in May and increased 0.7 percent against May 2003. However, girls’ and boys’ apparel prices fell in May and against a year ago. Girls’ retail prices fell sharply by 3.1 percent last month and were down 2.9 percent against a year ago, while boys’ prices fell 1.1 percent in May, but were up 2.5 percent in the 12 months.
Meanwhile, retail prices for men’s apparel edged up 0.2 percent last month and were up 0.1 percent compared with May 2003.
“This year’s rebounding apparel retail pricing has been driven primarily by boys’ [on a year-over-year basis] and women’s wear, and not by men’s or girls’ wear,” said Charles McMillion, chief economist at MBG Information Services. “This latest information on retail pricing supports other recent, hopeful indications of stabilization for the industry. However, the information also defies easy explanation and is particularly inconsistent with [Monday’s] trade report that suggested sharply falling import prices of textiles and apparel.”
In the overall economy, prices for all retail goods increased 0.6 percent in May, following a 0.2 percent gain in April, which put economists on alert about a potential interest rate hike by the Federal Reserve Board. High energy and food prices drove up the overall CPI in May.
President Bush, fielding questions from reporters at a Rose Garden press conference with Afghan President Hamid Karzai on Tuesday, claimed the economy is strong at a time concerns about inflation are rising.
Asked if he was worried about inflation, Bush said: “What I’m pleased about is the fact the economy is strong and getting stronger, and all indications are the economic stimulus plan we put in place is working. There is strong growth, there are new jobs being added, consumer spending is up and after-tax disposable income is high. The ingredients for continued economic growth are present.”Carl Steidtmann, chief economist at Deloitte Research, said he expected the Fed to raise interest rates as a result of the latest figures. Fed Chairman Alan Greenspan has indicated he would raise rates if inflation continued. However, Steidtmann said he believes retail prices have reached a peak, with oil and gas prices falling this month, after a period of steep increases.
Broken out by category, retail prices for outerwear rose 2.3 percent in May but fell 0.7 percent against a year ago, while prices for dresses were up 1.9 percent last month and increased 1.4 percent compared with May 2003. Suits and separates prices gained 0.5 percent in May and jumped 4.8 percent year over year, as prices for underwear, nightwear, sportswear and accessories rose 2.6 percent last month, but fell 2.1 percent against a year ago.
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