WASHINGTON — Men’s retail apparel prices fell a seasonally adjusted 0.2 percent in March and rose 0.5 percent compared to a year ago.
Within the men’s apparel category, shirts and sweaters slid 3.7 percent in from last month and 3.4 percent from last year. Suits, sport coats and outerwear prices increased 1.3 percent from last month and 2.1 percent from last year. Men’s pants and shorts increased 1.9 percent from last month and 3.3 percent compared to last year.
Boys’ apparel declined 2.6 percent from February and increased 3.6 percent from March of last year.
Apparel prices as a whole slid 1.3 percent from last month and 1.4 percent from last year. Women’s apparel declined 2.7 percent from last month and 4.5 percent from last year.
It is possible that the slowdown in apparel prices has been impacted by flagging demand.
“There is a slowdown going on too, we do expect that the demand for apparel is declining, especially since consumers are taking a hit with food and energy prices. They have less left over for apparel and other things,” said Kenneth Beauchemin, U.S. economist for Global Insight.
Retailers could also be responding to economic pressures that consumers are faced with, said John Lonski, chief economist, Moody’s Investor Services. The slowdown in the economy and slackening in the labor market might make consumers resistant to price increases, he said.
“It would be more difficult for retailers to increase apparel prices,” Lonski said.
Apparel prices defied the overall trend in March. All other categories saw retail price increases. Prices for all goods and services increased 0.3 percent in March after remaining flat in February and rising 0.4 percent in January and December.
The core prices, excluding the volatile energy and food sectors, increased 0.2 percent in March. Core prices were also flat in February and increased 0.3 percent in January. Prior to January the core prices crept up 0.2 percent each month for nine months straight.
Wholesale apparel prices dipped in March, sliding 0.1 percent in March from February and 0.2 percent from a year ago, according to the Labor Department’s Producer Price Index. It is worth watching inflationary trends in wholesale prices, because if retail prices and wholesale prices are not in line it could squeeze retailers, Lonski said.
“It is not a good thing if retail price inflation is lagging wholesale price inflation,” he said.
Economic conditions continued to weaken across the country, according to the Federal Reserve Board’s Beige Book report released on Wednesday.
Anecdotal reports said that discretionary spending weakened in the majority of the twelve districts tracked in the report since the last survey. Non-auto retailers in ten districts said their sales were “sluggish or declining.” Demand for luxury goods was strong in Chicago, San Francisco and, to a lesser extent, Philadelphia according to retailers in those districts.
One retailer in Boston said the recession had probably started for retailers in December, while another said: “It’s just a question of the consumer getting through the next few months.” Prices in Boston for goods were steady and modest increases were passed along where possible, according to the report. Retailers in New York said that prices were steady in their district but significant cost increases could be on the horizon.
Some districts struggled with some sectors. One large mid-price retailer in Philadelphia said their consumer had “pulled out of the market,” and a department store employee in Washington D.C. said shoppers were “only spending when they had to.”