Dublin, June 19 2019: Visa’s Irish Consumer Spending Index, produced by IHS Markit, which measures expenditure across all payment types (cash, cheques and electronic payments), signalled a modest reduction in overall spending during May. The latest data showed that expenditure declined by -1.4% on the year, following growth of +1.2% in April. May marked the second month in 2019 that a reduction in spending has been registered.
The overall fall in spending was driven by a -3.0% year-on-year decline in Face-to-Face expenditure. Following two months of modest growth in March and April, May data signalled a return to the period of contraction in Face-to-Face expenditure observed towards the end of 2018 and start of this year.
Meanwhile, eCommerce spending continued to rise during May, but the rate of growth maintained its recent downward trend, falling to just +1.8% year-on-year. That was the weakest increase in spending on this measure for over a year-and-a-half.
At the sector level, the Food & Beverages (-0.7%), Clothing & Footwear (-2.6%), Transport & Communication (-2.6%) and Miscellaneous Goods & Services (-3.9%) sectors all registered year-on-year falls in expenditure.
Growth was recorded elsewhere, albeit to varying degrees. Household Goods performed the best, recording growth of +4.7%, but elsewhere rates of expansion were generally modest. Notably, spending in the Hotels & Restaurants category was up by just +2.2%, the slowest growth since August 2017.
Philip Konopik, Ireland Country Manager, Visa said: “While the fall in Irish consumer spending has largely been driven by a poor performance on the High Street, it seems that consumers are becoming more cautious of their purse strings as eCommerce also recorded a weakened rate of growth for the third successive month. While some sectors did see a rise in spending, rates of expansion have slowed. For example, while there was a small boost for Hotels, Bars & Restaurants, it represented the slowest rate of growth for the sector since August 2017.”
Paul Smith, Economics Director at IHS Markit said:
“Irish consumers pulled back on their spending during May, especially on the high street and in key retail categories such as Food & Beverages and Clothing & Footwear. The latest data add to a view of a weakening Irish economy in the first half of the year, in line with the broader European and global slowdown. Against this backdrop, any notable pick-up in the coming months seems unlikely, although the recent improvements in consumer sentiment and business surveys provides hope of a return to some stabilisation and modest growth.”