Sales growth on the high street has come to a halt, but prices have risen sharply, according to the CBI's latest Distributive Trades Survey.
The CBI's latest Distributive Trades Survey said that 36% of retailers saw year-on-year sales volumes fall in the first half of February.
The CBI added that sales for the time of year were slightly below average. However the rate is not expected to worsen next month, with retailers expecting continued flat sales.
But despite increasingly cautious consumers tightening their belts, the CBI said prices of goods in the year to February increased at their fastest rate in over a decade, as retailers felt the pressures of rising energy, food and raw material costs.
According to the CBI, 50% of respondents to the survey said that average selling prices were up on a year ago, with only 6% saying they were down. This was the strongest indication of price rises since August 1996.
CBI chief economic adviser Ian McCafferty said: "The high street has been slowing gradually since last April and sales earlier this month were very subdued, while prices have risen strongly. Reflecting the increasingly tough conditions faced by the sector, business sentiment and investment plans have both taken a hit."
Sales volume in the wholesale sector fell heavily over the year to February, but were driven by tumbling sales in the food and drink industries.