Retailers are already talking about price increases of up to 15 percent this year on holiday goods, from staples such as tree ornaments and toys to luxury gifts such as European handbags and clothing. The main cause? It's the same old chestnut, soaring energy prices.

Although most consumers are just starting to think about back-to-school shopping, retailers are already preparing for the critical holiday season. Consumers have been seeing prices creep up for many products, but escalating cost pressures - which are also being fueled by the weaker dollar and higher labor costs in China - are forcing merchants from low-price warehouse clubs to upscale clothiers to pass on more of the burden in the months ahead.

Many stores in Utah and nationally are laying out their holiday displays but still deciding on their holiday prices. Receding oil prices in recent weeks could provide a bit of relief, but buying that status handbag now might help shoppers save a little. For some items, though, it's already too late.

And any big surge in demand could lead to more bad news on the inflation front, serving as a catalyst for prices to spiral.

With bigger price increases, the nation's merchants risk turning off shoppers who may end up buying fewer holiday gifts to keep to their budgets. That could mean a serious hit for the economy, because consumer spending accounts for two-thirds of all economic activity and the holiday period accounts for a huge chunk of merchants' sales and profits.

''Truthfully, I probably won't purchase items that go up that much - especially something like Christmas decorations,'' said Marilyn Reese of Cincinnati, who works at an insurance company. ''I will just go with what I have.''

The price increases come as stores also have to be pushing even deeper discounts this holiday season to attract customers. But that 50 percent off may not be as good a deal as last year because the original price could be higher.

Even Costco, which had been one of the bright spots in retailing, warned last week that its profit was getting squeezed by rising energy costs and it would have to raise prices more. Richard Galanti, Costco's chief financial officer, specifically cited holiday decor and rotisserie chickens, which are popular for holiday meals.

Holiday decor could be as much as 12 percent pricier than a year ago, and the price of rotisserie chicken, which had been $4.99 for years, was raised to $5.49 about three months ago and just went up to $5.99 last week.

Toy prices could be about 10 percent higher for the holidays than a year ago. K-B Toys Inc., which focuses on selling past toy hits at discounted prices, says it isn't increasing prices for now. The chain even unveiled a program Monday that offers temporary price cuts on some already reduced toys. A spokeswoman for Toys ''R'' Us Inc., said prices for some products will stay steady, while others will have ''gradual'' increases beginning in early fall.

Prices for mass-market apparel, which have fallen for decades because of oversupply and cheap labor from China, are also seeing prices rise a bit because of higher wages from that country and that's forcing stores to shift production to other low-cost countries such as Vietnam. Quentin Crenshaw, a spokesman at J.C. Penney, said the department store chain doesn't expect to increase overall prices for the holidays - even for goods that are sourced primarily in China.

Rising costs

* WHAT'S NEW: Consumers could be facing price increases of up to 15 percent on holiday goods, from toys to handbags. The increases are being driven by rising energy prices, higher labor costs in China and a weak dollar.

* THE IMPACT: The price increases could make shoppers buy fewer holiday gifts so they can keep to a budget, which would be a hit to the economy.

* REALITY CHECK: Some price increases may not be felt as much as others.

A 10 percent increase on toys, for example, may not feel as tough because toys are still cheap.