UK retailers have issued a record number of profit warnings this year, fuelling fears of a high street meltdown this Christmas.

Accountancy firm Ernst & Young said that retailers had posted 46 profit warnings this year so far – up 53 per cent on last year. There have been 11 since the start of October alone, including French Connection, Moss Bros, Alexon and Sports Direct.

This week, furniture retailer Ponden Mill went into administration, putting 1,300 jobs at risk.

Ernst & Young senior retail manager Jason Gordon said that other retailers could go bust in the new year, as consumers rein in their spending amid fears over the credit crunch.

The firm reported that markdowns in high street stores are running at their highest level – an average of 36 per cent – which is 1 per cent higher than last Christmas. Some stores are offering up to 80 per cent off selected products.

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