The Nationwide Consumer Confidence Index said consumer spending has been particularly hard hit by recent interest rate rises.

Expectations about the future fell, while the number of people confident about buying household and major items also dropped in August.

However, expectations of future house price growth increased to 3.8%.

A Nationwide spokeswoman said:

"The fall in each of the consumer confidence indices is not surprising given the five increases in interest rates in just a year.

"It now seems clear thar consumers are taking this to heart in their spending intentions."

It follows similar findings from the British Retail Consortium's (BRC) Retail Sales Monitor for August and a Confederation of British Industry (CBI)/Grant Thornton survey.