Business Irish

Wednesday 20 November 2019

Recovery Index: A feed of pints

Further evidence that consumers smashed the piggy banks and went on the lash last month emerged this week.

Excluding motor trades, the volume of retail sales increased by 0.8 per cent in December 2012 in comparison to both the month and year before, according to the CSO.

There was some heavy damage done in the nation's boozers as we went on the tear. Pubs, bars and department stores showed the biggest jump in spending during the month, while sales of sofas and other furniture took a dive.

This rise in retail sales comes in tandem with improved consumer sentiment. Now all the Government has to do is to deliver a really good bank deal by the end of March. No pressure then.

Ireland's tallest building

The Elysian Tower in Cork is Ireland's tallest building. It was one of the painful symbols of the country's fall from boom to bust as buyers shied away from purchasing apartments in the humungously tall tower block. In a positive sign that the rental market is improving, most recent figures suggest that over 40 per cent of the 210 apartments are now occupied.

Irish banks on the drip

The dependence of Irish banks on soft loans from the ECB teat has eased over the last month. ECB borrowing in the covered banks totalled €48.7bn, with a further €40.4bn in ELA support, bringing the total to €89.1bn – that's €6.8bn lower than in November last and the lowest level since August 2010. Irish banks have benefited from the stability in deposits, deleveraging and a return to market financing that saw AIB and Bank of Ireland both raise money on the markets at the end of 2012. Healthier banks equal a healthier economy.

Strong euro

The euro has strengthened significantly against many of the major currencies over the recent months – most notably against the Japanese yen. With expectations of further quantitative easing at Bank of Japan, plus improving sentiment in the eurozone, the euro/yen rate has grown 8 per cent this month alone. While this is good for anybody thinking of heading to the Land of the Rising Sun for their holidays, it makes things more difficult for exporters seeking to sell into this huge market.

Unemployed women

The number of women who are currently long-term unemployed has absolutely rocketed, rising five times as fast as the number of men in the same boat. Women have been particularly hard hit by layoffs and poor trading in the hospitality and retail sector. Last week saw the live register stay locked at 14.6 per cent, with 10,913 less people signing on. Despite some good news out this week about six new companies offering 147 new jobs, the vast majority of this drop comes from unemployed people emigrating to find jobs abroad.

Mortgage lending

Although the January bank lending survey showed that business loan demand and credit standards were both unchanged at the end of last year, far more positive mortgage lending numbers were released by bankers' lobby group the IBF. The number of mortgage approvals for house purchases rose by over 40 per cent year-on-year during December. Given that the banks upped their mortgage lending targets for 2013, this is another step towards creating a functioning property market again.

Irish Independent

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