By and  on June 20, 2012

As retailers and vendors head out to buy and sell their wares at trade shows and regional markets across the country in the coming weeks and months, they do so with some positive and negative indicators.

The good news for the fashion industry is that the prices of raw materials, from cotton to gasoline, have dropped or stabilized and is expected to stay that way through the second half of the year. The bad news is that economists generally forecast the pace of economic growth will continue to moderate, which was underscored by signs of weaker growth in some leading indicators in May.

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Last year’s near panic over historically high cotton prices, and concurrent hikes in synthetic fiber costs have been replaced by prices dropping back to long-term norms and expert predictions of near-term stability. Cotton Incorporated’s May Economic Report noted that cotton prices moved lower over the past month and fell sharply with the release of the U.S. Department of Agriculture’s May report. The July New York futures contract fell from 93 cents a pound in late April to below 82 cents a pound. The December 2012 contract, which is important since it reflects price expectations following the upcoming harvest, fell below 80 cents a pound, the report said. The A Index, which had been holding to a tight range around $1 a pound, dropped below 95 cents to its lowest values of the 2012 calendar year.

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