Heatwave drives Irish consumer spending to fastest growth in almost two years

Dublin, 16 July 2018: Visa’s Irish Consumer Spending Index, which measures expenditure across all payment types (cash, cheques and electronic payments), pointed to a pick-up in the rate of growth in Irish household expenditure in June, driven by the recent heatwave across Ireland.

Consumer spending was up +5.5% year-on-year in June, up from the +3.7% increase recorded in May, signalling the fastest rise in household spending since July 2016. Growth was also sharper than the average since the series began in September 2014. Solid increases in spending were recorded across both Face-to-Face and eCommerce channels. The rate of expansion in eCommerce spending (+5.5%) eased to a three-month low in June, while Face-to-Face (+5.4%) saw the strongest rise since January.

As was the case in May, the Household Goods sector posted the fastest increase in spending of the eight monitored sectors (+13.0% year-on-year), with home improvement stores selling items like BBQs and garden furniture performing well. Double-digit growth was also seen in the Hotels, Restaurants & Bars sector (+10%) with publicans and hoteliers reporting a heatwave boost with families enjoying staycations in Ireland, as well as sporting and music events helping to drive footfall.

Household spending on Food & Drink reached a three-month high in June, up +7.9% year-on-year. Elsewhere, marked and accelerated increases in spending were seen in the Clothing & Footwear (+5.0%), Transport & Communication (+7.0%) and Recreation & Culture categories (+4.5%) with summer clothing and outdoor events proving popular due to the good weather.

Philip Konopik, Ireland Country Manager, Visa said:

“As Ireland enjoyed a heatwave in June, consumer spending continued to tell a positive story recording the fastest rise since July 2016. The good weather benefited the Irish high street in particular, with Face-to-Face spending marking the strongest increase since January. Notable winners in the recent heatwave were Household Goods and Hotels & Restaurants, both recording double-digit growth. Food & Drink and Clothing & Footwear also experienced accelerations in spend last month as consumers stocked up on the latest trends and essentials to enjoy the sunshine.”

Andrew Harker, Associate Director at IHS Markit said:

“The heatwave in Ireland helped to boost consumer spending in June, resulting in the strongest expansion for almost two years. Sector data shows that Hotels & Restaurants, Food & Drink and Clothing & Footwear all saw growth accelerate as households headed out onto the high street to eat, drink and shop while basking in the summer sun. With the good weather continuing into July, consumer confidence at the highest for nearly two-and-a-half years and unemployment at the lowest in over a decade, the stage is set for further increases in spending as the second half of 2018 begins.”

ENDS