SPENDING by Premier League clubs slumped 10% to £450million over the summer - with many shunning foreign stars.

Even Manchester City's £120million spree failed to see the top flight match the record sum of £500m spent a year ago.

Football finance experts believe the high rate of the euro and 50% tax rate for very high-earners contributed to the drop, particularly in terms of players coming from the Continent.

And net spending crashed from £200m to £80m as clubs like Manchester United, Arsenal and Liverpool resisted spending all their earnings from selling Cristiano Ronaldo, Emmanuel Adebayor and Xabi Alonso.

Paul Rawnsley, director of Deloitte's Sports Business Group, said the figures were no surprise.

He said: "There are a number of factors - the exchange rate, the tax regime in Spain being more favourable to players, and perhaps clubs thinking there is less of a risk in buying established Premier League players than from overseas."

Rawnsley does not expect the picture to alter next year either even if, as expected, the top flight benefits from a big rise in the value of overseas TV rights.

He added: "The Premier League is expected to secure enhanced values for international media rights generating higher revenue for clubs.

"However, without further significant capital injections from owners, transfer spending is unlikely to exceed the record achieved in 2008."

Deloitte's analysis shows Manchester City's spending has been around £120m - 27% of the summer total.

Rawnsley said football's credit crunch had also been heightened by the owners of clubs like Man United and Liverpool facing masssive interest payments on huge loans.

He said: "Having to pay interest can have a bearing on transfer budgets, but some clubs may have felt that, thanks to the spending of Real Madrid and others, the transfer market has been too inflated."