NEW YORK (CNNMoney.com) - A new report tracking national retail sales in May indicates that this year's run-up in gas prices has started to eat into an already slowing rate of consumer spending.

According to the latest report from MasterCard Advisors, the consulting arm of Mastercard International (Research), total retail sales last month excluding auto purchases rose 0.2 percent from the prior month.

Excluding both auto and retail gasoline purchases, sales dipped 0.1 percent since April.

"A lot of people have been concerned about what lies underneath the covers when you factor out gas. So far people had only been talking about consumer spending slowing down but it had not materialized in the numbers," said McNamara, vice president of research and analysis with MasterCard Advisors. "The data now shows that the sustained increase in gas prices is showing an erosion in consumer spending."

The report showed that year over year total sales, excluding gas and auto purchases, rose 5.9 percent in May. That was down from 8.3 percent growth back in February.

"The thing that is raising the flags for us is that when you look at the core sales growth excluding gas and auto, we're seeing it come down for the fourth consecutive month," said McNamara.

The Spending Pulse report comes ahead of next week's government report on May retail sales. Economists surveyed by Briefing.com expect total retail sales rose 0.1 percent while sales ex-auto rose 0.5 percent. Both numbers are expected to show weakness versus the prior month.

The Commerce Department's numbers are drawn from results of a monthly survey of retailer establishments. The MasterCard Spending Pulse report estimates are based on aggregate network activity of the MasterCard U.S. payment network with MasterCard variables extracted. MasterCard processes more than $500 billion dollars in retail sales activity each year.

Regardless of what measure you want to follow, consumer spending is heading toward a very distinct and significant slowdown, said Nariman Behravesh, chief global economist with Global Insight. That's a worrisome prospect given that consumer spending fuels two-thirds of the U.S. economy.

"Gas prices will disproportionately hurt lower-income families and the sales weakness will hurt stores like Wal-Mart more than the high-end sellers like Nordstrom," he said.

Moreover, he expects the housing slowdown to further depress spending in the months to come. "Home income withdrawal is gone. So that support to spending is no longer there," he said.

Behravesh warned that consumer spending for the rest of the year will be weak. His forecast for the all-important holiday shopping season, which accounts for almost 50 percent of retailers, is equally gloomy.

"It could be the weakest holiday season in three or four years. However, it's not like the economy is falling out of bed. We still have a fairly decent job market and wage growth. These factors should support spending so that we'll see slowing growth and not negative growth ahead."

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Consumer confidence slips in May. Click here for more.

Retail sales weaker than expected. Click here for more.

Wal-Mart's gas threat. Click here for more.

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