WASHINGTON — Retail apparel prices rose in February, as a big increase in men’s prices offset a decline in women’s prices, according to the Labor Department’s Consumer Price Index released Tuesday.
Women’s apparel prices fell a seasonally adjusted 0.7 percent in February, while men’s apparel prices rose 3.2 percent. Apparel prices overall rose 0.3 percent. Girls’ prices rose 0.7 percent last month, while boy’s prices fell 1.4 percent.
“It looks like a blip,” said Ryan Sweet, director of consumer research at Moody’s Analytics. “The gain was isolated in men’s and [girls’] apparel. Prices for women’s, boys’, toddlers and infants fell and footwear was flat. The trend of very weak pricing in apparel will continue for the rest of the year.”
In the women’s category, outerwear prices fell 2 percent, while prices for the combined category of underwear, nightwear, sportswear and accessories dropped 0.3 percent. Prices for suits and separates fell 0.1 percent, while dress prices rose 0.3 percent last month.
In men’s wear, prices for shirts and sweaters rose 7.2 percent, while prices for the combined suits, sport coats and outerwear category increased 2.1 percent. Prices for pants and shirts were up 1.5 percent and prices for furnishings increased 1.2 percent.
Weakness in retail pricing power has deepened in the past year. The appreciation of the dollar, falling commodity prices, prolonged discounting and bargain-conscious consumers have all been factors. While consumers have responded well to discounts and lower prices on apparel, they have been held back by somewhat sluggish wage and income growth, economists have said.
“In the big retail picture, the appreciation of the dollar is beneficial but lower gasoline prices have not paid dividends yet to retailers, from a spending perspective,” Sweet said. “It seems that consumers are pocketing most of the savings they get from the pump.”
Sweet said despite the lower import prices and transportation costs, there has not been a sustained acceleration in consumer spending, primarily because of weak wage growth.
However, IHS expect stronger wage growth to translate into higher consumer spending for the second half of the year.
“Spending has been choppy and typically at this time of the year it hits a soft patch so I’m not surprised we are seeing a weaker pricing environment for many retailers. I think as spring and summer approaches, we should see better pricing, partly because of stronger demand,” Sweet said.
“The apparel prices did spike up,” said Chris G. Christopher, Jr., U.S. chief economist at IHS Global Insight. “But overall apparel prices are deep in the negative territory on a seasonally adjusted month-to-month basis for almost every month in the fourth quarter last year.”
But Christopher also said he expects consumer spending to pick up this year, which could help boost overall consumer prices.
“We do expect consumer spending to be considerably stronger in the two middle quarters of this year because of lower gasoline prices,” Christopher said. “The strong dollar makes consumer imports cheaper,” which he said could spur more consumer spending.
The overall CPI rose a seasonally adjusted 0.2 percent. Core retail prices, excluding volatile food and energy prices also rose 0.2 percent in February.