An economist says the cost of living is restricting people's retail spending

Electronic card transaction figures show total retail spending was down three-percent in the year to March.

It fell 0.7 percent in the month.

ASB senior economist Mark Smith says the downturn is driven by the Reserve Bank trying to get inflation down.

He says they're doing that by putting up interest rates to crunch household spending -- and that spend's expected to remain soft over this year.