Fourth Quarter Kick Off: Decline in Women’s Apparel Prices Drags Down October CPI

Source: https://sourcingjournal.com

Led by soft pricing power in women’s wear, retail apparel prices inched up a seasonally adjusted 0.1 percent in October compared to the previous month, according to the Consumer Price Index (CPI) report released Wednesday by the U.S. Bureau of Labor Statistics (BLS).

As the critical fourth-quarter holiday selling kicked in and the promotions began, women’s apparel appeared particularly vulnerable, falling 1.7 percent last month after rising 1.6 percent in September.

Pushing the decline—and often at the forefront of early season price-cutting sales—was the women’s outerwear category, where prices declined 6.4 percent. But all women’s apparel categories saw price declines in October, potentially owing to the sector’s more competitive nature and buying habits.

Prices for dresses were down 4.3 percent, suits and separates prices fell 0.5 percent and the underwear, nightwear, sportswear and accessories group dipped 0.1 percent. Girls’ apparel prices were up 1.1 percent month over month.

Men’s wear pricing power proved much stronger, with prices rising 1.5 percent. The suits, sport coats and outerwear group posted a price gain of 3.9 percent, as prices for pants and shorts rose 2.3 percent. Smaller increases of 0.9 percent for furnishings, and 0.6 percent for shirts and sweaters rounded out the men’s story for the month. Boys’ apparel prices were up 0.9 percent, while infants’ and toddlers’ apparel prices rose 0.8 percent.

The mixed picture on prices comes along with the uncertainty on raw material costs that has plagued the industry in recent months. Cotton prices, for example, have stabilized from a mid-June season-high of $1.02 per pound, but remain on the high side. U.S. spot cotton prices averaged 74.83 cents per pound for the week ended Nov. 8, up from 74.13 cents per pound the prior week and 66.94 cents a year earlier, according to the U.S. Department of Agriculture.

Manufacturers have also reported increases in polyester and other fiber prices. These have generally been driven by added costs from raw material to make those fibers, as well as uneven demand.

In the footwear sector, overall retail prices were down 0.3 percent last month. Women’s footwear prices rose 0.6 percent but men’s fell 0.2 percent and boys’ and girl’s dropped 2.2 percent.

The CPI for all consumer goods increased 0.3 percent in October on a seasonally adjusted basis after rising 0.1 percent in September, BLS reported. Over the last 12 months, the CPI rose 2.5 percent before seasonal adjustment.

An increase in the gasoline index was responsible for more than a third of the gain, while advances in the indexes for shelter, used cars and trucks, and electricity also contributed. The so-called core index, minus the volatile food and energy sectors, rose 0.2 percent in October following a 0.1 percent increase in September.



Categories: Apparel, Business, Retail, Textile, USA

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