The High Street suffered its worst trading in a quarter of a century this month as wet weather and creaking household finances put off shoppers.
The CBI said 60% of retailers reported a fall in business this August compared with just 13% who said it was rising.

The rounded balance of minus 46% was sharply down on the minus 36% recorded in July and the lowest reading since records began in 1983.

It was even more desperate than in the last recession of the early 1990s and pointed towards further pain for the British economy.

Sir Philip Green, head of the Arcadia retail empire and owner of Topshop, said: “Everybody knows that the market is very very tough. Why is it suddenly going to change?”

Richard McGuire of RBC Capital Markets said the survey was “unequivocally gloomy” while “extremely grim reading” was the verdict of Vicky Redwood at Capital Economics.

The figures from the CBI came as building society Nationwide reported the sharpest fall in house prices for 18 years.

Redwood said: “With the Nationwide data showing a further drop in house prices, there is little hope of relief for retailers any time soon.”
McGuire added: “The CBI data provide yet further confirmation, were it needed, that the writing is on the wall for the UK consumer.”

Stores selling furniture, carpets and household goods were the worst hit with every shop reporting a fall in trade this month as the housing market collapsed. Supermarkets were the only retailers to report a growth in sales, although it was well below the record set in July.
And in a worrying sign for the Bank of England as it looks to control inflation, the balance of retailers reporting a rise in prices remained high at 48.Andy Clarke, chairman of the CBI survey and retail director of Asda, said: “This has been a summer that many retailers would rather forget.”

CBI chief economic adviser Ian McCafferty said: “Retail conditions have been extremely tough this summer, and the wet August has been a further blow. Sadly no let-up is expected as we head into early autumn.”