If you asked your grandmother for interview fashion tips, she'd probably advise to "dress for the job you want, not the job you have," but the professionals seem to think now is the time to simply play it safe. Wearing casual or unusual clothes in times of economic success can be a positive because it gives the impression you're a risk-taker, but that's not what employers are looking for given the current market.
Sandy Ruddock, who is the founder of image consultants Public i, recommends plain dark suits and white shirts for men and a simple jacket, skirt and blouse combo for a woman. My general rule for interview attire is to dress one step up from the company's dress code (unless of course their dress code is extremely formal). So, if employees adhere to business casual guidelines, you should wear a suit for your interview.
I think it's most important to focus on the overall success of your interview and the things you shouldn't do, but it's clear first impressions go a long way. What would you wear if you had an interview right now?