Morgan Stanley’s card index predicts that Britons will spend £645 on their plastic during this time.

This is 31 per cent less than they had planned to spend during the last quarter of 2005 and although a reduction in spending is usual for the post-Christmas period, the figure represents an 11 per cent year-on-year decline.

Consumers are planning to cut back in the area of luxury purchases for the most part, while spending on essential every day items such as groceries will remain relatively stable.

The amount spent on homes and cars is expected to fall from £202 in the final three months of 2005 to £152 in the coming three months.

It also seems that people will be staying in more, with spending on socialising set to fall by 43 per cent.

“Following recent reports of a prudent festive period, our index shows that we can also expect to see a drop in credit card spending over the next three months, particularly on luxury purchases,” said Patrick Muir, marketing director of the Morgan Stanley credit card.

“Spending on everyday items remains steady, with grocery shopping being the top category for credit card spending.

“Customers seem to increasingly recognise the advantages of using their credit cards on everyday items, as they can receive benefits such as cash back on all their purchases.”

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