Whether retailers will raise apparel prices now that 15 percent tariffs on Chinese imports are in place might be in question, but the Consumer Price Index (CPI) for August shows they might have already gotten started.
Retail apparel prices were up a seasonally adjusted 0.2 percent in August compared to the previous month, and were 1 percent higher than a year earlier, according to the U.S. Bureau of Labor Statistics (BLS) report released Wednesday. It also marked the third consecutive month of retail increases in the category.
The gains were nearly across the board, with only girls’ apparel bucking the trend with a 3.3 percent decrease, potentially due to back-to-school promotional activity.
Men’s apparel prices were up 1.1 percent in the month, with increases of 3 percent in suits, sport coats and outerwear; 2.8 percent in the underwear, nightwear, swimwear and accessories group; and 0.7 percent in shirts and sweaters. The pants and shorts sector went against the grain with a 0.4 percent decline.
Women’s apparel prices rose 0.7 percent last month compared to July, with an increase of 2.7 percent in suits and separates somewhat balanced out by decreases of 5.9 percent in outerwear, 4.4 percent in dresses and 0.1 percent in the underwear, nightwear, swimwear and accessories group.
Boys’ clothing prices were up 2.5 percent in the month, while prices on infants’ and toddlers’ apparel rose 0.3 percent.
The prices might have been even higher if not for the prolonged slump in the cost of cotton. U.S. spot prices on cotton averaged 54.61 cents per pound for the week ended Sept. 5, according to the U.S. Department of Agriculture (USDA). That was up from 53.69 cents per pound the prior week, but down from 78.33 cents a year earlier, USDA said.
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The overall CPI increased 0.1 percent in August on a seasonally adjusted basis after rising 0.3 percent in July, BLS reported. Over the last 12 months, the CPI was up an unadjusted 1.7 percent. The 12-month increase has remained in the range of 1.5 percent to 2 percent since December 2018.
Increases in the indexes for shelter and medical care were the major factors in the monthly increase, outweighing a decline in the energy index–important for business operations and disposable consumer income–which fell 1.9 percent, according to BLS.
The core index, excluding the volatile food and energy sectors, rose 0.3 percent in August, the same increase as in June and July, driven up by increases in the indexes for recreation, used cars and trucks, and airline fares. The core CPI rose 2.4 percent for the year through, its largest 12-month increase since July 2018.