A gloomy portrait of business activity over the past three months has been issued by Bradford Chamber of Commerce, which predicts a stark and sustained slowdown in activity.

The chamber's latest survey shows that businesses suffered from a fall in sales and orders both at home and abroad between April and June.

There was equal pessimism in both the manufacturing and service sectors. Both reported "significant" falls in turnover and said confidence had been "rocked" especially in manufacturing.

The chamber said that investment in equipment and training in manufacturing had fallen dramatically over the three month period. It did say, however, that investment in equipment in the service sector had increased.

Both public and private sector organisations needed fewer staff during this period and there had been a substantial fall in the number of companies trying to recruit.

The chamber said it expected the downturn to continue in the July to September period.

Chamber president Roland Clark said: "It's terribly disappointing but, based on conversations with other businesses in the last few months, it's not entirely out of the blue. A sustainable growth pattern seems impossible to achieve for many businesses and there is now considerably more uncertainty than this time last year.

"Consumer spending is weaker, as is sterling, and poor Eurozone growth and political turmoil in the EU has heightened worries. With turnover, investment and confidence all plummeting in the way that they have in these results, urgent steps now need taking to restore stability and boost the business environment."

Mr Clark said the case was overwhelming for an immediate cut in interest rates.

The chamber said there were additional pressures to raise prices especially in manufacturing. Exchange rates, increased competition and inflation were also creating difficulties. In the service sector there was less pressure to raise prices.

The British Chambers of Commerce have already pointed out the likelihood of falling growth in the UK economy because of lower spending as well as a riskier global landscape. Last month it revised down its GDP forecast.

The Bradford Chamber said it expected to see one and possibly two interest rate cuts this year with a third early in 2006.

Sandy Needham, Bradford Chamber's chief executive, said it promised to be a difficult year for businesses.

"Prospects don't appear brighter in the short-term, due to the changing political and economic landscape, Europe-wise, at least. Even if we see immediate interest rate cuts, it may take time for that reassurance or confidence to come through.

"We often speak of the resilience of local business in its task of being successful. Well, that resilience has taken a knock this time.''