Irish consumer spending increases +4.2% year-on-year in March
Dublin, 11 April 2017: The latest data from Visa's Irish Consumer Spending Index, which measures expenditure across all payment types (cash, cheques and electronic payments), saw a +4.2% year-on-year increase in expenditure. The latest reading pointed to a solid expansion, but still represented slower than the average growth since the series began in September 2014.
For the first quarter of 2017 as a whole spending was up +2.5% year-on-year, with the rate of expansion slowing for the third successive quarter.
Growth in eCommerce spending accelerated sharply to +18.1% year-on-year and was the strongest in four months. In contrast, face-to-face expenditure declined for the sixth successive month. The annual rate of contraction eased to -2.4%, but was still the third-largest decline in the 31-month series history.
Transport & Communication remained the strongest performer on a sectoral basis, seeing growth in spending quicken to a four-month high of +12.0% year-on-year. Four of the eight monitored sectors posted a return to growth in March following declines in February. A particularly strong rebound was seen in Recreation & Culture, where spending was up +7.5% on the year, the strongest rise since November last year. Food & Drink expenditure rose modestly on an annual basis in March (+1.4%). Spending growth has now been recorded in the sector in three of the past four months.
Two categories continued to record declines in expenditure, namely Clothing & Footwear and Hotels, Restaurants & Bars. The former posted the sharper reduction, seeing a fall in spending for the seventh time in the past eight months. Consumers spent less (-1.0%) in the Hotels, Restaurants & Bars category for the second month running, with the rate of decline only slightly slower than the Leap Day-affected reading from the previous month.
Philip Konopik, Country Manager, Ireland, Visa said:
“Irish consumer spending continues to rise, albeit at a reduced pace, with March recording the sixth month in a row where the rate of growth was less than five percent. While this is positive, there is cause for concern in two areas. Face-to-face spending has been in decline for the past six months and the Clothing & Footwear sector is particularly challenged. The ongoing bus strike has impacted regional businesses and it could hold face-to-face spending back.”
Andrew Harker, Senior Economist at IHS Markit said:
“As expected, consumer spending rebounded in March following the Leap Day-related fall in February, with the expansion broadly in line with those seen around the turn of the year. However, the first quarter as a whole saw the rate of growth ease from the end of 2016 as consumer confidence remained muted. There is still little sign of a recovery on the high street, with Face-to-Face spending now in a protracted downturn, and so eCommerce is having to drive growth at present.”