The strongest signal yet that higher interest rates are biting hard came today with the release of figures that showed that credit card debt in the UK had fallen for the first time in more than a decade.

The British Bankers' Association also announced this morning that mortgage demand was weaker in April.

Adrian Coles, director general of the Building Societies Association, hailed the figures as showing that the mortgage market had "achieved a soft landing".

But the most startling statistic from the BBA this morning was that, for the first time since May 1994, credit card debt was reduced, as cardholders paid off £40 million more than they borrowed on their plastic.

At the same time, the BBA said savings were up £3.4 billion in April, higher than the recent monthly average of £2.3 billion.

The credit data confirms that the slew of disappointing sales figures from high street retailers, including Next, Boots and Sainsbury this week, as consumers rein-in their spending.

It all tends to further suggest that the general downturn in consumer spending may persuade the Bank of England to lower interest rates from the present 4.75 per cent base rate sooner than it opts to increase them.

"This is another indication that the consumer is being more cautious in the light of lower household disposable income. The household belt is tightening," David Dooks, BBA spokesman, said.

The fall may be temporary: higher High Street spending recorded by the Office for National Statistics in April will not have an impact on credit card bills until May. There was also a £415 million increase in loans and overdrafts during the month.

"The apparent change of sentiment towards credit may also be being reflected in personal deposits, which have been relatively strong in the last couple of months," Mr Dooks said.

The Council of Mortgage Lenders also released figures this morning which showed that mortgage lending rose, albeit modestly, from £20 billion in March to £21.5 billion in April.

Higher tax receipts pushed public sector net borrowing down from £2.8 billion a year ago to £1.3 billion, below the £2.5 billion forecast by economists.

Economists said the figures added to the view of a strong labour market with income tax receipts more than 14 per cent higher than a year ago and corporation tax up 9.7 per cent.

In contrast, revenues from VAT were less buoyant to provide fresh evidence of slowing consumer spending and tough conditions being experienced by retailers on the UK high street.

A Treasury spokesman said: "With a further strengthening in the public finances in April, today’s figures show we are continuing to meet our fiscal rules."

But Gerrard chief economist Simon Gerrard said that there had been substantial revisions to previous numbers.

"Today’s data increases the pressure on the Chancellor to introduce measures to boost the tax take in the next budget," he said.