The gap between the proportion of high street shops reporting rising sales, and those seeing a fall is at its widest for nearly three years, according to new figures from company bosses' organisation, the CBI.
With 22 per cent of retailers saying sales have been higher this month than at the same time last year, and 44 per cent reporting a fall, the margin between the two is bigger than at any time since March 2009.
Overall 20 per cent more traders reported disappointing sales for the time of year, while 23 per cent of those questioned said they expected sales to still be down in February.
People are cutting back most severely on spending on durable household goods and hardware and DIY items, the CBI's figures show.
But grocery sales have continued to rise in January, up by six per cent year-on-year, although this is well down on the 52 per cent boost which a combination of Christmas sales and supermarkets' aggressive price-cutting brought about in December.
Chief economic adviser at the CBI, Ian McCafferty, said: “Shoppers have reined in spending across the board at the start of the New Year after taking advantage of early discounting last month, which boosted pre-Christmas sales.
“Family budgets are under continuing pressure with inflation still high and wage increases modest,” he added.