WASHINGTON — Women’s apparel prices rebounded in August, but declines in men’s, boys’ and girls’ clothing prices drove down overall retail prices in the sector, according to the Labor Department’s Consumer Price Index released Wednesday.
Women’s apparel prices rose a seasonally adjusted 1.5 percent in August after falling 1.3 percent in July. Prices in the overall retail apparel category fell 0.2 percent in August. Men’s apparel prices were down 1.3 percent, while prices for boys’ apparel dropped 4.5 percent and prices for girls’ apparel declined 3.5 percent.
Jeet Dutta, senior economist at Moody’s Analytics, said promotional activity during the back-to-school season and falling input and import prices, combined with weakness in many global economies, have led to a decline in commodity prices.
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“There is quite a bit of weakness overseas,” Dutta said. “There has been quite a slowdown and fresh signs of weakness in developing countries, most prominently in China….In this kind of environment, you don’t see a lot of pricing power in commodities. Once commodity prices are weak, it feeds into the supply chain for most goods and that tends to keep prices low.”
In the women’s category, outerwear prices rose 4.5 percent, while women’s suits and separates prices increased 1 percent. Declines were seen in dresses, which fell 0.8 percent, and in the combined underwear, nightwear, sportswear and accessories, which declined 0.2 percent.
In men’s wear, the biggest drop in prices were for shirts and sweaters, which fell 4 percent in the month, and in the combined suits, sport coats and outerwear group, which dipped 0.7 percent.
“It does seem that pricing power was quite weak across the board in many categories,” Dutta said. “The headline CPI [down 0.2 percent] was mainly driven by declining energy prices, but if you look outside of food and energy, the core CPI was flat. A lot of categories of household items such as home furnishings and even apparel and medical care continued to be weak.”
Dutta noted that while consumer demand and sales have been “decent,” retailers are still being cautious in their pricing strategies.
Chris G. Christopher Jr., director of consumer economics at IHS Global Insight, said consumer prices fell for the first time since April 2013.
“In August and July, the recent food price gains were accompanied by a decline in energy prices,” Christopher said. “The good news is that gasoline prices fell in July and August, helping many Americans swallow higher grocery bills. Overall, the consumer inflation story is relatively mild. The direction of food prices is worrisome. Core consumer price inflation is clearly falling short of the Fed’s target, giving them time on rate hikes.”