Significant Drop in Apparel Prices Provides Relief from Inflation

Prices for apparel and household items saw notable declines in September, even as the Consumer Price Index for All Urban Consumers (CPI-U) rose 0.4%. 

This increase followed a 0.6% rise in August and contributed to a 3.7% increase in the all items index that has been recorded over the last 12 months, the Bureau of Labor Statistics (BLS) said in a Thursday (Oct. 12) press release.

Major contributors to the increase in September included shelter and gasoline, while indexes that decreased over the month included apparel and used cars and trucks, according to the release. 

Prices for apparel experienced the most significant decline since the onset of the pandemic, Bloomberg reported Thursday. This drop in prices seen in September extends across various categories, from women’s dresses to men’s suits and children’s shoes. 

Additionally, household items such as bedroom furniture and appliances like laundry equipment also saw notable decreases in prices during the month, according to the report.

Lauren Fernandes, director of global thought leadership at researcher NIQ, told the media outlet that this suggests people are focused on covering essential household needs rather than indulging in large furniture purchases. 

While clothing and furniture prices offer some respite, Americans continue to face higher prices for necessities like housing and energy, according to the report. Furthermore, wage growth is failing to keep up with inflation, putting pressure on consumers’ purchasing power.

While the prices of certain goods are decreasing, the cost of services continues to rise, the report said. The Labor Department report highlights significant gains in categories such as recreation services, including tickets to live sporting events. 

In response to the uncertain financial outlook, retailers are increasingly resorting to promotions to attract buyers, per the report. 

PYMNTS reported in August that American retailers are increasingly turning to promotions as consumers grow cagey about nonessential spending. Offering deals has become a fact of life for retailers as consumers seek out bargains to offset their worsening financial situation.

Brands are also embracing value-based messaging, emphasizing characteristics like durability and usefulness, PYMNTS reported Oct. 3. This helps brands appeal to consumers who are dealing with financial stress by relying on their savings, using their credit cards, delaying certain expenditures or reducing spending.