Its monthly consumer confidence index showed a 12 point fall to 86 last month, the biggest drop it has ever recorded, while the spending index fell by 14 points to 63 to its lowest ever recorded level.

The expectations index fell by 14 points, the second biggest recorded fall, due to consumers' showing less confidence about the future.

A Nationwide spokeswoman said:

"Uncertainty about the effects of the credit crunch together with rising oil and food prices seem to be affecting feelings about jobs and the future economic situation.

"With this in mind, it is natural that consumers would think about tightening their belts this Christmas and this is reflected in the weaker spending index."