Sales slowdown on the High Street

RETAIL sales grew at their slowest pace this year during October as interest rate hikes started to bite. The British Retail Consortium said underlying sales were up just 0.5% on last year, with total sales up 3%.

Shoppers appeared to be cutting back on 'big ticket' items such as widescreen TVs, computers, carpets and furniture.

BRC director-general Kevin Hawkins says: 'There is no escaping that the High Street trading environment is tough in the run-up to Christmas.'

Clothing sales started strongly in October, but have tailed off with the wet weather, though footwear remains popular.

Marks & Spencer is expected to warn of dismal sales when it announces first-half results today.

Its clothes are still lagging behind recent fashion trends and the retailer has been forced to cut prices to clear stock. Analysts are braced to make big profit downgrades.