The drop followed a decline of 1.8 percent in February, and retail price increases in women's apparel in January, December and November. Apparel costs as a whole slid 1.3 percent from February and 1.4 percent from March 2007. Men's apparel declined 0.2 percent for the month and increased 0.5 percent from last year, while girls' apparel declined 2.4 percent from February and slid 9.4 percent from March 2007.
Apparel costs defied the overall trend in March, as all other categories saw retail price increases. Costs for all goods and services increased 0.3 percent in the month, after remaining flat in February and rising 0.4 percent in January and December.
The core prices, excluding the volatile energy and food sectors, increased 0.2 percent last month. They were also flat in February and increased 0.3 percent in January. Prior to January, the core costs crept up 0.2 percent each month for nine months straight.
In women's apparel, outerwear and dresses contributed to the downward price movement, said Jessica Penvose, women's analyst with the U.S. Bureau of Labor Statistics. Outerwear prices slid 8.5 percent in March and 5.8 percent compared with a year ago. Dresses fell 7.4 percent for the month and 1.4 percent for the year. Suits and separates declined 2 percent in March and 6 percent from a year ago, and the combined category of underwear, nightwear, sportswear and accessories increased 1 percent from February and 2.1 percent from March 2007.
March is normally a month when apparel costs are raised to coincide with the arrival of spring and summer merchandise in stores, but that was not the case this year, Penvose said.
"Prices aren't going up as much as they have in the past," Penvose said.
It is possible that apparel has been affected by flagging demand in a weakened economy.
"There is a slowdown going on," said Kenneth Beauchemin, U.S. economist for Global Insight. "We do expect that the demand for apparel is declining, especially since consumers are taking a hit with food and energy prices. They have less left over for apparel and other things."