Retail sales showed their worst decline in eight years
The grip of the recession may have "relaxed" a little according to a new survey of Scottish businesses.
The latest Lloyds TSB business monitor said fewer firms had reported a drop in turnover than was recorded in the previous quarter.
Lloyds TSB chief economist Donald MacRae said: "Whether this relaxation is temporary or permanent remains a crucial question."
Meanwhile, retail sales showed their worst decline for eight years.
The Lloyds TSB survey, which is conducted by the Fraser of Allander Institute at the University of Strathclyde, monitored 1,904 companies in Scotland.
It said 22% more companies had reported a drop in turnover than a rise.
The figure, though still negative, was a 9 percentage point improvement on the previous quarter.
The findings were still significantly worse than a year ago when 8% more businesses recorded an increase in turnover than a fall.
Service businesses were most severely affected.
Expectations for increased turnover in the next six months remained negative for the third consecutive quarter but improved from -44% to -28%, the monitor said.
Figures from the Scottish Retail Consortium (SRC) showed a drop in like-for-like sales of 0.9% last month compared with February 2008.
January had shown a surprise improvement in high street sales, driven by heavy discounting.
In February, total sales, which do not strip out the effect of new stores, were up 2.7% on a year ago.
This was the slowest increase since January 2006.
SRC director Fiona Moriarty said: "Consumer confidence is waning, people are buying less and retailers are having to discount heavily, driving prices down."