Inflation pressures continued to weigh on the U.S. economy as shelter and food costs continued to rise in September, the Bureau of Labor Statistics reported on Thursday.
The bureau’s latest Consumer Price Index (CPI) saw prices increase 0.4% from last month and 8.2% from the same time last year. Excluding volatile food and energy costs, the Core CPI rose 0.6% from August and 6.6% from the same month in 2021.
Today’s latest CPI update caused a stock sell off on Thursday morning. As of this report, the Dow Jones Industrial Average slid nearly 157 points, or 0.54%. The S&P 500 dropped 1%, and the Nasdaq Composite sank 1.7%.
But while these latest inflation numbers for U.S. retail are still painfully high, new data from the Footwear Distributors and Retailers of America (FDRA) suggests that footwear prices continue to moderate.
In September, footwear retail prices rose 3.9% over the past year, the slowest increase in 17 months. Men’s footwear prices rose 3.1%, women’s climbed 4.8% and kids’ expanded 3.5%. These gains in all three components are a bit slower than noted in recent months, the FDRA noted.
Even with the September deceleration, footwear prices over the first nine months of the year are up 5.5% from the same period last year and still are on track to rise in 2022 at the sharpest rate in decades.
“Echoing our view last month…on the one hand, these retail footwear prices are higher because import costs for footwear continue to rise,” the FDRA said in a note to FN. FDRA calculations of import data from the United States International Trade Commission (USITC) show the average implied landed cost of footwear rose 25% year-over-year in August, the fifth straight month of double-digit gains.
On the other hand, footwear supply is poised to outstrip demand by a wide margin this year, pointing to softer prices ahead. Footwear imports—a proxy for supply—so far this year are up about 24.3% from the same period last year. But consumer spending on footwear is up only about 4.3%.
“On balance, we continue to expect retail footwear price increases will be higher than trend but will continue to moderate—slowly—as we head into 2023,” the FDRA added.
Today’s latest data follows Wednesday’s report from Adobe that showed online prices fell 0.2% year-over-year and rose slightly by 0.8% on a monthly basis in September.