The City fears fashion group Next may report a like-for-like sales slump of as much as 10 per cent tomorrow, when the retailer updates on first-quarter trading.

Next has guided analysts to expect a comparable store sales decline of between 4 and 7 per cent for the first half already. However, poor spring weather and the consumer slowdown has hit clothing retailers hard and Next’s trading may have been pushed further off course.

Pali International analyst Nick Bubb said: “With consumers increasingly price-sensitive, the middle market is getting badly squeezed and Next is right in the firing line.”

Kaupthing analyst Matthew McEachran said Next’s core customers are among the worst affected by the credit crunch.

He warned: “There is still considerable risk to the third-quarter/second-half sales assumptions, so we suspect downgrades may be on the cards.”

Topics