Irish consumer spending in August records +2.2% year-on-year growth

Dublin, 17 September 2018: Visa’s Irish Consumer Spending Index, produced by IHS Markit, which measures expenditure across all payment types (cash, cheques and electronic payments), revealed that Irish household spending rose +2.2% year-on-year in August, with the rate of expansion unchanged from that seen in July (+2.2%). Although the latest rate of expansion remains weaker than average (+4.8%) since the series began in September 2014, growth remains steady and household expenditure has now risen on an annual basis throughout the last eighteen months.

Face-to-Face and online sales record solid growth. While eCommerce recorded a sharper rate of growth (+2.4%), this represented its weakest expansion since January of this year. In contrast Face-to-Face spending rose by +2.1% this month, which means that high street expenditure has now posted twelve successive months of growth.

Household Goods remained the best-performing sector in August, posting the fastest rate of expansion (+9.4%) across the eight categories. Recreation & Culture and Hotels, Restaurants & Bars also experienced accelerated growth of +5.6% and +5.4% respectively. CSO figures for August point to significant rises in restaurant and hotel costs, which was also a main driver behind the rate of expansion.[1]

While most sectors posted rises in expenditure, Clothing & Footwear registered a fall in spending for the second month running, with the rate of decline unchanged from July (-1.1%). Expenditure was also down in Health & Education (-0.3%) and Miscellaneous Goods & Services (-2.4%).

Philip Konopik, Ireland Country Manager, Visa said:

“While recent rises in Irish consumer spending remain weaker than average, it’s highly encouraging to see that household expenditure has now risen on an annual basis over the last year and a half. With the combination of a continued increase in earnings and subdued price inflation, consumers are benefiting from more disposable income to enjoy trips away and recreational activities as the summer comes to an end.”

Andrew Harker, Associate Director at IHS Markit said:

“Consumer spending growth continues to tick along nicely as the summer draws to a close, with both the high street and online sales increasing solidly. With wages increasing at the strongest pace since the financial crisis and unemployment remaining relatively low, economic conditions appear to be supportive of further increases in expenditure during the rest of 2018.”

[1] https://www.cso.ie/en/releasesandpublications/er/cpi/consumerpriceindexaugust2018/