As the economic landscape continues to shift, Irish consumers are feeling the pinch. Retail sales took a hit in February, with a noticeable drop in spending on cars, clothes, and in department stores, according to figures released by the Central Statistics Office (CSO).
The volume of sales fell by 2% in February, but showed a modest increase of 1.1% on an annualized basis. Excluding car sales, the volume remained stagnant for the month, with a slight uptick of 0.7% for the year.
Notably, the biggest declines were seen in motor trades (-9%), department stores (-7.1%), and clothing, footwear, and textiles (-6.3%). However, there were some bright spots, with bars (+11.8%), hardware, paints, and glass (+10.5%), and non-specialized stores (including supermarkets) (+0.3%) recording monthly increases in volume.
The recent price shocks, coupled with 10 interest rate hikes from the European Central Bank (ECB), were expected to have a more pronounced impact on retail sales. However, the effect has been somewhat tempered, thanks in part to robust employment figures and consumers dipping into savings accrued during the pandemic.
The value of retail sales saw a modest increase of 0.7% in February and a 3% rise over the 12 months leading up to February. It’s worth noting that some of this year-on-year increase in value may be attributed to rising prices.
Despite the overall dip in retail sales, online transactions from Irish-registered companies accounted for 4.9% of sales in February, down from 5.7% in January but slightly up from 5.2% in February 2023.
While challenges remain, including ongoing inflationary pressures and interest rate hikes, the resilience of Irish consumers and the evolving retail landscape suggest that the road to recovery may be paved with cautious optimism.
(Source: Irish Times)
