EVEN the likes of the well-respected John Lewis Partnership has felt the pinch and reported a 99 per cent fall in first-half profits.

The employee-owned business, which also includes the Waitrose supermarket chain as well as its highly regarded department stores, said pre-tax profits before one-off items fell to £1.2m in the six months to 28 July, from £83m a year in the same period a year earlier.

The main reason for the disappointing results was the heavy discounting at other retailers, which forced John Lewis stores to lower prices under their signature “never knowingly undersold” pledge.

Senior management reported that gross margin has been squeezed in what has been the most promotional market they have seen in almost a decade.

The company added that the “level of uncertainty facing consumers and the economy, in part due to ongoing Brexit negotiations” made it difficult to forecast trading for the next six months but it expected full-year profits to be down.

Despite the hit to profits from matching discounts, especially in fashion and beauty, the company would be sticking with its “never knowingly undersold” pledge, highlighting the trust consumers have in the brand as extremely valuable.

Bank of England governor Mark Carney has played down reports claiming that he warned ministers of a house price collapse in the event of a no deal Brexit.

He had originally claimed that inflation, unemployment and interest rates would all rise, causing house prices to be 35 per cent lower in three years’ time than would otherwise be the case.

The predictions assume a breakdown in trading relations with the EU which would lead to a contraction in the supply of goods and services into the country.

After being criticised for his gloomy no deal Brexit warnings, Mr Carney insisted that the Bank of England "is well-prepared for whatever path the economy takes, including a wide range of potential Brexit outcomes".

The average house price was £228,384 in June 2018 and a 35 per cent slide would take prices back to £148,449, the lowest level since June 2004.

As you would expect many industry commentators were more optimistic on the outlook, trying to reassure investors that the UK property market has proven to be able to withstand some pretty turbulent economic news, not least when the country voted for Brexit and after Article 50 was invoked.

New data revealed that unemployment in the UK remained at four per cent in the three months to July, but annual wage growth accelerated from 2.7 to 2.9 per cent in the same period.

After factoring in inflation, however, wage growth was only 0.2 per cent, an historically low level especially given such high employment. Adjusted for inflation, regular pay was still below the peak reached just before the financial crisis.

Investors will hear more about inflation on Wednesday as the latest consumer prices index data is released. Previously it was 2.5 per cent in July.