WASHINGTON — Retail prices for women’s apparel rose a seasonally adjusted 0.1 percent in December, but the long-term deflationary pressure continued, the Labor Department’s Consumer Price Index revealed Thursday.
Compared with December 2002, women’s retail prices fell 1.6 percent, a reflection of price pressures that plagued apparel retailers all year.
For all apparel, retail prices fell 0.4 percent in December on a seasonally adjusted basis, following a 0.5 percent decline in November. Compared with 2002, retail prices for apparel fell 2.1 percent. Consumer prices for girls’ apparel dipped 2.4 percent in December and plunged 4 percent for the year, while prices for men’s wear rose 0.1 percent last month, but fell 1.7 percent year over year.
“I was optimistic going into the Christmas season, but it looks like at least for clothing retailers [prices] didn’t come in as strong as we had initially expected,” said John Mothersole, senior economist at Global Insight. “The weakness we have seen in apparel for quite some time looked like it was ameliorating a little in the last couple of months, but the November and December data was disappointing.”
Mothersole noted the drop in November and December retail apparel prices followed a string of yearly increases from June to October. The lift in prices, however, was dashed by a drop in the last two months of the year.
Charles McMillion, president of MBG Information Services, said retail apparel prices have been falling annually since 1993.
“Nominal retail prices of apparel are now back to levels last seen in February 1990,” McMillion said. “This decade of deflationary pressures is unprecedented in data going back to 1947 and reflects the glut of cutthroat-priced imports first from Mexico and now from Asia, particularly from China.”
Overall, retail prices inched up by 0.2 percent in December, but inflation was contained, according to economists. Stripping out the volatile food and energy prices, the CPI, which is the premier gauge of inflation, went up by 1.1 percent last year. For the year, all consumer prices rose 1.9 percent, but that was down from the 2.4 percent rise in 2002.
“When you roll it all up, it is a benign inflation environment,” Mothersole said.
In women’s apparel, retail prices for outerwear rose a seasonally adjusted 0.1 percent last month, but fell 1.1 percent against a year ago, while prices for dresses rose 0.3 percent in December and inched up 0.1 percent year over year.
Consumer prices for suits and separates rose 0.1 percent in December, but fell 2.7 percent against December 2002, while prices for underwear, nightwear, sportswear and accessories dipped 0.1 percent last month and fell 0.5 percent year over year.