The UK high street can expect its most miserable Christmas for 25 years, according to Seymour Pierce retail analyst Richard Ratner.

Ratner said in a note to investors that increased interest rates and higher utility bills will be two factors contributing to difficult market conditions.

Moreover, the last two weeks have been "something worse than a disaster" for apparel retailers, Ratner warned, adding: "We are hearing suggestions that the bulk of the trade was down between 10-20% in this period."

The troublesome trading is likely to lead to 'guerilla sales' as retail chains desperately seek to sell off Christmas stock, he said.

"We expect a strong final week, but many retailers are likely to lose their nerve ahead of this and begin heavily discounting.

"We believe that Christmas in 2006 will be worse than 2005, and could be as difficult as, or even softer than, 2004, which was the worst Christmas for 23 years. If the latter is the case, it will make it the worst for 25 years."

Ratner added that unpredictability meant he would warn off investors from buying stock in any of the UK's biggest retailers.

Other factors hampering the high street include the growing appeal of internet shopping - which is helped by people's keenness to avoid packed-out high-street stores in the Christmas run-up - as well as supermarket's widening offerings.

Market analyst Mintel has warned that December spending will rise just 1% from last year on repeated interest rate rises.

However, not all predictions for the market have spelt doom and gloom.

The British Retail Consortium has estimated that December spending will increase 6%, with an 8% rise in spending in the two weeks before Christmas.

The amount specifically spent on Christmas purchases, meanwhile, is estimated to increase by 10%.

BRC director general Kevin Hawkins said: "These are encouraging predictions for the retail sector after a tough year which has seen a slump in consumer confidence, escalating costs and falling prices. The high street is definitely eager for a boom Christmas.

"Christmas is by far the most important time of the year for many retailers and it is also the best indicator of how confident consumers are heading into the New Year. I think sales figures this Christmas will give us a genuine read on the state of economy in the short term."