Consumers continue to withdraw cash at a growing rate in the run up to Christmas, pointing to a good spending outcome for retailers.

The new data from LINK, the UK ATM network operator, covers daily cash withdrawals for the period up to 18 December 2007 from more than 64,000 LINK cash machines in the UK.

The figures compare the percentage growth in average daily cash withdrawals from November to December in 2006 and 2007, as well as comparing the increase in the total value of withdrawals in December 2006 and December 2007, for the first 18 days of the month.

Average daily cash withdrawals so far this December are up by 8.1 per cent on November, while in the same period last year, the increase from November to December was 7.8 per cent.

In 2006, £5.631 billion was withdrawn from LINK cash machines up to 18 December. In December 2007 so far, the withdrawals have reached £5.782 billion.

Richard Snook, economist at the Centre for Economics and Business Research (CEBR), who has examined the LINK data, said that the figures showed that consumers were not letting concerns over the credit crunch and the housing market affect their Christmas spending.

“The £5.8 billion of cash that has been withdrawn from LINK cash machines so far this month, has put December on course to post the highest ever withdrawals total,” he added.

The value of cash withdrawn from LINK cash machines has in the past been an accurate indicator of retail spending, and the relationship between the two variables on a month-by-month basis has remained strong and relatively constant.

Snook added that the December interest rate cut and growing likelihood of further cuts next year were giving consumers the confidence to continue spending.

“The Bank of England is now showing its willingness to counter the affects of the credit crunch on mortgage and credit card rates. This will help to prevent steep increases in the cost of credit, which many have been predicted since the onset of the financial crisis in July,” he concluded.

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