Mergers and acquisitions are one of the key ways in which "animal spirits", that amorphous but vital economic force, can be measured in the business world.

When chief executives are feeling confident about life, their share price and profits are buoyant and prospects are good, they are more likely to splash out the money of their shareholders buying a rival.

So figures this morning from the Office for National Statistics, pointing to a sharp decline in M&A activity in the first three months of the year, point to a possible downturn in confidence.

According to the ONS, there were 48 acquisitions of British companies by domestic rivals completed during the quarter totalling £3.6bn, down from £11.9bn during the first three months of 2016.

At the same time, British companies completed 26 acquisitions overseas, with a value of £1.9bn.

That was down from £8.8bn in the same three months last year and was the lowest since July-September 2013.

A lot of that may reflect the fact that during the first three months of the year, sterling was trading at substantially lower levels than it was in the same period last year, making it costlier for British firms to buy businesses overseas.

But the slowdown in domestic M&A activity is striking.

The sum actually spent by UK companies buying domestic rivals, £3.6bn, was actually up on the £2.5bn spent during the final three months of 2016.

However, it was substantially lower than the quarterly average of £6.2bn seen during the last 20 years, while the number of domestic deals done, at 48, was fewer than half of the quarterly average of 119 in that period.

It was also getting on for half as many deals as seen in the previous quarter.

That points to a real loss of nerve among domestic CEOs about prospects for the economy.

More troubling, though, is the sharp drop in the number of "inbound" M&A deals in which foreign companies bought British rivals.

There were 40 such deals in the first three months of the year, the lowest since the third quarter of 2015, while the total spent by foreign companies on UK rivals was just £5.1bn - which was down by a thumping 90% on the first three months of last year.

Now, it can be argued that the figures last year were distorted by an abnormally high number of "inbound" acquisitions, including the completion of AB InBev's £83bn takeover of brewer SAB Miller and Softbank's £25bn takeover of chip designer ARM Holdings.

Last year's figures were also boosted, during the second half, by the weakness of sterling that made British companies a more attractive target for overseas predators.

The value of M&A in the UK by foreign companies hit a record £187.4bn during 2016.

But that £5.1bn spent by foreign companies during the quarter was less than half the quarterly average, of £11.3bn, seen during the past 20 years.

That suggests that, despite the relative weakness of the pound, British businesses are less attractive to overseas buyers than they have been.

A glance at the major "inbound" deals highlighted by the ONS during the first three months of the year illustrates the drop-off in activity.

The £1.35bn takeover of caravan park operator Parkdean by Canadian firm Onex, or the £627m takeover of image sensor specialist e2v Technologies by US firm Teledyne, would scarcely have moved the needle in previous years.

Some may say this is good news. Plenty of people have argued over the years that it is undesirable for overseas companies to take over British ones.

However, given that one of the main ways in which Britain finances its trade deficit is by selling its companies to foreign rivals, it can be seen as a worrying development - and especially if it represents a loss of confidence in Britain, ahead of Brexit, by international business leaders.