Retailers predict weak Christmas

There was aggressive discounting in the second half of November

Retailers are overwhelmingly predicting falling sales this Christmas, according to the latest survey from employers' organisation, the CBI.

Of retailers polled, 40% more of them were predicting sales in December would be lower than last year than said sales would be higher.

They were polled in the first half of November, before many of them began aggressive discounting.

And retailers were even more gloomy about sales so far in November.

A large number of respondents, a negative balance of 46%, said retail sales were lower in the first half of November this year compared with one year ago.

Miserable week

"We are starting to see large rises in unemployment and households are very worried about the outlook for the economy, so they just don't want to spend," said Matthew Sharratt, at Bank of America.

The poll results continue a miserable week for UK retailers, with both MFI and Woolworths calling in administrators.

"The collapse of Woolworths could have the same effect on confidence that Lehman Brothers did in September," said Nick Bubb, retail analyst at Pali International.

"It reminds people just how bad things are, and there are a whole stack of retailer bankruptcies coming."

Other stores

Earlier on Friday, the department store chain John Lewis reported a 13% fall in weekly sales compared with the same week last year.

Several London retailers opened early on Friday

Also this week, B&Q-owner Kingfisher said third-quarter sales fell 9% amid slowing demand for home improvements.

And the owner of Currys and PC World, DSG International, reported an interim loss of £29.8m, blaming a "tough and volatile" trading environment.

In an attempt to boost sales, several stores in London's West End opened their doors early on Friday and offered special discounts.