Dublin, 13 February 2019: Visa’s Irish Consumer Spending Index, produced by IHS Markit, which measures expenditure across all payment types (cash, cheques and electronic payments), pointed to ongoing muted spending trends at the start of 2019. Although stabilising following the annual fall of -0.4% in December, spending was broadly unchanged – up just +0.1%. This represented one of the weakest performances since the series began in September 2014.
As has been the case in recent months, the high street remained the key source of weakness for household spending. Moreover, Face-to-Face expenditure was down for the third month running, with the fall of -5.3% year-on-year the sharpest in the 53-month series history. In contrast, eCommerce expenditure continued to rise sharply, with the rate of growth (+9.8%) little-changed from the previous month.
Growth in the Household Goods sector rebounded in January, rising +8.4% year-on-year. Hotels, Restaurants & Bars also posted a solid increase (+4.4%) in expenditure, albeit one that was softer than in December. Elsewhere, rates of expansion quickened in the Food & Drink (+1.9%) and Recreation & Culture (+2.1%) categories.
Three of the eight broad sectors saw spending fall year-on-year, namely Clothing & Footwear (-5.0%), Transport & Communication (-0.8%) and Miscellaneous Goods and Services (-5.2%). The fall in Clothing & Footwear expenditure extended the current sequence of decline to seven months.
Philip Konopik, Ireland Country Manager, Visa said:
“Irish consumer spending was flat in January, reflecting the lower level of consumer confidence in the economy. Once again, there was a notable contrast between the High Street and eCommerce with online retailers recording almost double digit growth, while the High Street saw the sharpest fall in expenditure since we started the Index. The Clothing & Footwear industry’s challenges in particular were highlighted after recording a seventh consecutive month where spending declined.”
Andrew Harker, Associate Director at IHS Markit said:
“Irish household spending remained subdued at the start of 2019 as falling consumer confidence has led to a paring back of expenditure. This is particularly the case on the high street as households head online to search out bargains in an uncertain economic and political environment. eCommerce retailers are the beneficiaries, able to generate strong growth in expenditure despite a general stagnation in spend.“
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