Shoppers cut back on spending dramatically last month as high inflation and concerns about tax rises squeezed households.
Consumer spending last month was up just 0.5pc in August compared with the same month a year, according to card data from Barclays.
That is down from July’s growth of 1.4pc, and is well below the rate of inflation, with prices up by 3.8pc over the past year.
It means households are spending more money but buying fewer goods and services, indicating they are cutting back in the face of rising costs.
Spending on groceries dropped 1.7pc on the year, even as food price inflation accelerates, while spending on home improvements and electronics was also down.
