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LONDON, March 19 (Reuters) - British households' sense of financial wellbeing dipped slightly in March but remained near its highest level for five years, a survey showed on Wednesday.
Markit's Household Finance Index for March slipped to 41.9 from February's 42.1, which had been the highest reading since the survey started five years ago.
While the index has risen markedly over the past few months, the mood was still classed as pessimistic overall, with any reading below 50 representing a negative outlook.
Still, survey compiler Markit said the results suggested Britain's economic recovery had stayed on track since the start of the year, with perceptions of inflation receding to their lowest since December 2009.
"Improvements in domestic economic conditions continue to support expectations of future financial wellbeing, with this index also staying close to February's five-year peak," said Tim Moore, senior economist at Markit.
Moore also said the index showed the squeeze on household incomes had eased.
British finance minister George Osborne will announce a pre-election budget on Wednesday that is likely to offer some tax relief to households but will stick closely to his tough decade-long plan to fix the public finances. (Reporting by Andy Bruce; Editing by Alison Williams)