The Nationwide Building Society has released the results of a survey which show that consumer confidence dropped to its lowest level in four years last month.
Nationwide said that its consumer confidence index dropped from 78 in February to 77 in March. The result is the lowest since the series began in May 2004.
The building society also said that the expectations index (which shows how consumers feel about the economic and employment situation and their income in six months time) was also at a series low of 79 for the third consecutive month in March
Fionnuala Earley, chief economist at Nationwide, said, The downturn in consumer confidence over the last six months is not surprising given developments in the financial markets and a weakening housing market.
The effect of recent interest rate cuts has yet to trickle through to people's pockets, particularly as food and energy costs are still high. Consumers may begin to feel more comfortable following the expected cut to rates this week, but it is unlikely that confidence levels will increase in the short term.