As cotton costs cool will garment prices fall too?

Most at risk are brands that focus on value-priced merchandise since their raw material costs make up a greater percentage of their total cost.

Anecdotal evidence from Hanesbrands, though, whose lines fall into this category, suggests shoppers have not resisted paying higher prices. "While still early, preliminary results support our assumption that units fall off less than the rate of price increases," Noll says.

Likewise, Eric Wiseman, chairman and CEO of VF Corporation, which owns more than 30 brands including Wrangler, Lee and The North Face, says: "Like everyone else, we're waiting to see how the second half unfolds as consumers come face-to-face with even higher prices in apparel and footwear.

"We don't know - no-one knows - how they will respond. So we're approaching the second half cautiously and controlling those things we can, including spending, pricing and inventories."

Looking ahead, the situation isn't helped by deepening economic worries, high unemployment and job uncertainties on both sides of the Atlantic.

While action earlier this week saw a last-ditch deal to raise the US's $13.4 trillion debt ceiling, new figures from the US Commerce Department raised the spectre that the country is heading for a second recession after consumer spending in June fell for the first time in almost two years.  

And in Europe, sovereign debt worries - including fears of possible bail-outs in Italy and Spain - continue to weigh on the purchasing power of customers there.

Research carried out by Kurt Salmon suggests consumers expect to spend the same dollar-wise next year as they did this year, but that will probably translate to fewer units because of the higher tickets.

But as Rangarajan notes: "There are so many moving parts right now it's difficult to really get a sense of what's going on, but it's going to be an interesting next couple of months, that's for sure."