The rate of retail spending growth in the UK is forecast to fall by more than 50 per cent between the fourth quarter of 2001 and the third quarter of this year, according to a report released yesterday by retail research company Verdict.

Growth in the third quarter of 2002 will drop to just 2.9 per cent compared to 6.5 per cent seen in the fourth quarter of 2001 says the report entitled "Retail Rollercoaster - Strategies For Success 2002."

Looking ahead, Verdict sees the rate of growth rising in 2003 and hitting 3.6 per cent at the end of that year.

The report says the slowdown will be caused by rises in interest rates, a weakening housing market and a drop in employment.

Verdict forecasts that clothing and footwear operators will see growth decelerate to zero in the third quarter of the year from 6 per cent at the end of 2001.

Although this is seen creeping back up to 2.3 per cent in the fourth quarter of 2003, it still falls well below recent buoyant levels.