Consumer spending fell 1.7% in March, over the same month last year, the greatest year-on-year drop since the start of 2005, the Confcommercio retailers' association reported on Monday.
At the same time, consumer prices jumped 3.1% and this confirmed ''a deep and structural crisis in domestic demand,'' Confcommercio said.
For the first three months of the year, consumer spending dipped 0.7% over the first quarter of 2007, when spending rose 0.3%.
According to Confcommercio, the biggest quarterly declines in spending were for consumer goods, down 3.4%, while spending on services rose 2.3%.
Because of a sharp drop in the demand for new cars and motorbikes, down 14.8% over March 2007, Italians also spent less for fuel in March.
Italians also spent less on food, despite the Easter holiday falling in March, with food sales down 1.1% for the month and 1.7% for the first quarter.
