Footwear prices continued to decline in July as consumer prices overall are near its lowest in 29 months.
According to the U.S. Bureau of Labor Statistics’ latest Consumer Price Index (CPI), consumer prices increased 0.2 percent from last month and 3.2 percent from the same time last year. Excluding volatile food and energy costs, the core CPI also rose 0.2 percent from June and 4.7 percent from the same month in 2022.
Almost all of July’s monthly inflation increase came from shelter costs, which rose 0.4 percent and were up 7.7 percent from a year ago. The bureau noted that shelter prices accounted for over 90 percent of July’s overall increase, with the index for motor vehicle insurance also contributing.
Steve Lamar, president and CEO of the American Apparel & Footwear Association (AAFA), added that high shoe and clothing prices continue to be a “stubborn reality” of our economy. “This will sadly remain the case as long as policy makers favor trade and economic policies that keep logistics costs, tariffs, and interest rates high,” Lamar told FN.
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But, as inflation continued to ease overall, so too have retail footwear prices, according to new data from Footwear Distributors and Retailers of America (FDRA). After rising sharply from mid-2021 through mid-2022, footwear price gains have slowed over the last year and even declined over the last two months.
Retail footwear prices dropped 1.6 percent compared with last July, the most significant decline in 29 months, the FDRA noted. Women’s footwear prices declined 1.8 percent, while children’s footwear dropped 1.3 percent last month. Men’s footwear prices declined 1.2 percent year-over-year for the sixth straight month in July.
Despite declining in July, year-to-date footwear prices remain flat versus the same first seven months of 2022, the FDRA added.
“Over the long term, average import costs for footwear tend to rise or fall in step with retail footwear prices,” Gary Raines, chief economist at FDRA, told FN. “We’ve noted the last few months that an usually wide gap between import costs and these retail prices had arisen, and we looked for either retail footwear prices to go sharply higher or — more likely — landed costs to edge lower to close this gap. With retail footwear prices certainly not likely to go sharply higher, we continue to look for these import costs to remain soft well through 2023, narrowing this gap further.”
Online prices in July also fell 1.6 percent year-over-year, according to new data from Adobe on Tuesday. This marked the 11th consecutive month of year-over-year price decreases. Compared to June, online prices fell 0.9 percent in July.
