RETAIL APPAREL PRICES TUMBLE
Byline: Kristi Ellis
WASHINGTON — Retail prices for all apparel in November dropped 0.9 percent, marking the biggest November decline since 1940, the Labor Department’s Consumer Price Index revealed Friday.
And don’t expect apparel prices to rebound any time soon — analysts say there’s more price pounding still to come.
Women’s apparel prices followed a similar deflationary pattern, posting a 1.8 percent decline last month and a 4.2 percent year-over-year decline.
“That’s substantial,” a Labor analyst said of the declines in women’s wear. “In the last two years, women’s prices in the index have been hit hard in November.”
Ongoing price pressures at retail, plummeting consumer confidence, weakening demand and the general recession have pushed the deflation.
“These numbers tie into declines in retail sales,” said Carl Steidtman, chief economist at Deloitte Research. “A lot of weaknesses we saw in the sales report reflect decline in prices as opposed to declines in volume.”
Charles W. McMillion, chief economist at MBG Information Services, noted that the November price decrease followed two months of increases, and that increases in September and October were reflected by earlier-than-expected discounting at retail. The seasonal adjustment merely “caught up” in November.
“Nothing major occurred in November except that prices continued to be weak,” McMillion said. “Prices are still extremely low and neither producer nor retailer have any pricing power.”
In the overall economy, prices for all retail goods remained unchanged in November, after decreasing 0.3 percent in October. “A sharp upturn in the index for tobacco and smoking products, coupled with larger gains in the indexes for shelter and for new vehicles, accounted for the acceleration in November,” the Labor department said in its report.
In the women’s apparel categories tracked by Labor, retail prices for outerwear were down 3.3 percent for the month and declined 4.5 percent against November 2000. Women’s dress prices dropped 2.5 percent last month and 0.6 percent year-over-year. Suits and separates declined 3.1 percent in November and 5.3 percent from last year.
Prices for underwear, sportswear, nightwear and accessories declined 0.8 percent last month and 3.8 percent against November 2000. Girls’ prices were up 0.4 percent in November, but plunged 5.1 percent year-over-year.
“The recession for the economy as a whole has not found the bottom,” said McMillion.