(Bloomberg) -- British households continue to curb their spending, leading to the worst quarter for consumers in over five years, according to a report from Visa.
Spending dropped by 2.1 percent in March following a 1 percent annual decline in February. Spending in stores and online both declined compared to a year ago, with transport and communication the weakest sectors. The figures show a continuing deterioration of one of the biggest parts of the U.K. economy.
Britons have been struggling to maintain borrowing and consumption, with inflation accelerating in the wake of the U.K.’s 2016 vote to leave the European Union. Bad weather, including a storm dubbed the “Best from the East” in March, could also have kept shoppers at home.
“We are in the midst of a dip in consumer confidence and this -- coupled with other economic factors -- is causing shoppers to continue to restrain themselves,” said Mark Antipof, chief commercial officer at Visa. “The negative impact that the ‘Best from the East’ had on U.K. economic activity last month has been widely reported, but this doesn’t entirely explain March’s lackluster consumer spending.”
The Bank of England said last week that tightening criteria from lenders was reducing the availability of unsecured credit to households. The Office for National Statistics will report March retail sales figures on Thursday, and economists expect them to fall from a month earlier.
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