According to the study, consumers were much less likely to make major purchases, such as buying houses, with the Index down 11 points on last month, and 23 points on March last year.
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Public confidence in the state of the housing sector has also been hit, with activity in the market down and expectations of annual price rises down from 3.4 per cent in February, to 3.2 per cent last month.
Fionnuala Earley, chief economist at Nationwide, said: “Although consumers appeared slightly more upbeat in March, the overall picture is still subdued. With uncertainty about the interest rate position, but with the risk clearly on the upside, consumers are unlikely to recover confidence in the short term.”
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Despite confidence in the housing market being hit, overall confidence rose in March by three points. However, the figures are well below what they were in February 2006.
Ashley Clark, director of Need An Adviser.com, said: “The Bank of England’s target to curb the UK’s love of spending is working. Increasing rates is achieving the desired affect of keeping the economy stable and it comes as no surprise that people are becoming more nervy. This is exactly what the Bank wants.”
