Dublin, 9 January 2018: Visa's Irish Consumer Spending Index, which measures expenditure across all payment types (cash, cheques and electronic payments), pointed to a +4.9% year-on-year increase in spending during December. This followed a +5.1% rise in the previous month, highlighting the continued expansion of consumer spending for ten successive months in 2017.
Household spending in Ireland continued to rise at a solid pace at the end of 2017. Looking at the fourth quarter of the year as a whole, spending was up +3.6% on an annual basis. This was the strongest rate of expansion seen during 2017. The increase in Irish Consumer Spending for 2017 overall was more modest, with year-on-year growth of +2.5%, compared to 2016.
Data for December signalled a positive Christmas period for retailers on the high street, with Face-to-Face expenditure up +5.3% year-on-year. Face-to-Face spending has now risen in each of the past four months, with December’s growth marking the fastest increase seen since April 2016. Last month also marked the third successive month where Face-to-Face spending outperformed growth in eCommerce payments (which saw a solid rise at +3.8%).
While there has been a recent recovery in Face-to-Face spending, it was unchanged (0%) for 2017 as a whole. In contrast, the level of online shopping by Irish consumers rose +7.4% last year in comparison to 2016.
Looking specifically at the December data, the Household Goods category recorded the strongest growth during the month, seeing a double-digit year-on-year expansion for the fourth time in the past five months (+12.2% year-on-year). Sharp increases in expenditure were also seen in the Hotels, Restaurants & Bars (+9.7%) and Recreation & Culture (+8.6%) sectors, the former posting the fastest rise since May 2016.
Irish households increased their spending on Food & Drink on an annual basis in December, the fourth month running in which a rise has been recorded. At +5.4%, growth was at an eight-month high. A solid rise in expenditure was also seen on Clothing & Footwear for the second month in a row, with a +4.2% increase.
Transport & Communication also saw a sharp increase in spending, with the rate of growth quickening to the fastest since March last year, at +6.0%. The only one of the eight broad categories to see a drop in spending in December was Health & Education (-0.6% year-on-year).
Philip Konopik, Country Manager, Ireland, Visa said:
“The December data is another boost for the economy, with a strong finish for the year and positive growth for 2017 overall. The increase in Irish consumer spending is reflective of the strides being made in the labour market with the unemployment rate continuing to fall and average weekly earnings continuing to rise. One particular highlight from our data is the beginning of a recovery for Irish retailers, with Face-to-Face spending having risen for four consecutive months – showing a +4.1% year-on-year rise for Q4, which we hope marks the start of a trend.”
Andrew Harker, Associate Director at IHS Markit said:
“2017 ended on a positive note as far as Irish consumer spending was concerned, with December repeating the gains seen in the previous month. With Black Friday and Cyber Monday increasingly extending the Christmas period into November, the festive season as a whole looks to have been one of solid growth. The high street has fared particularly well, putting in a performance not seen in the best part of 18 months. Overall, these numbers suggest that the economy is in good shape as 2018 gets underway.”