Business

Retail sales slump 2% as cost-of-living challenge keeps spending tight

Largest monthly declines were recorded in motor trades, department stores and clothing, footwear and textiles

The CSO figures show the value of retail sales was up by 0.7 per cent in February and rose by 3 per cent in the 12 months to February. Photograph: Alan Betson

Eoin Burke-Kennedy
Thu Mar 28 2024 - 12:51

Retail sales fell in February as high interest rates and pinched household budgets saw consumers cut back spending on cars, clothes and in department stores.

Central Statistics Office (CSO) figures show the volume of sales fell by 2 per cent in February but were up by 1.1 per cent on an annualised basis.

Excluding car sales, the volume of sales was unchanged in the month and rose by 0.7 per cent in the year.

The largest monthly declines in retail volumes were in motor trades (-9 per cent), department stores (-7.1 per cent) and clothing, footwear and textiles (-6.3 per cent).

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Monthly volume increases were recorded in bars (+11.8 per cent), hardware, paints and glass (+10.5 per cent), and non-specialised stores (including supermarkets) (+0.3 per cent).

The recent price shock combined with 10 interest rate hikes from the European Central Bank (ECB) had been expected to lead to a slump in retail sales but the impact has been more muted than expected with employment remaining strong and consumers using savings built up during the pandemic.

[ Consumer sentiment dips in March as cost of living still bites ]

The CSO figures show the value of retail sales was up by 0.7 per cent in February and rose by 3 per cent in the 12 months to February. Some of the year-on-year increase in value may be driven by prices.

The proportion of retail sales transacted online (from Irish-registered companies) was 4.9 per cent in February compared with 5.7 per cent in January and 5.2 per cent in February 2023.

Eoin Burke-Kennedy

Eoin Burke-Kennedy

Eoin Burke-Kennedy is Economics Correspondent of The Irish Times

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