Monday 28 May 2018

Spending surge as consumers splash out on holidays, cars and day trips

Spending rose by 5.6pc in June compared with the same month last year
Spending rose by 5.6pc in June compared with the same month last year
‘Jurassic World’ helped boost box office receipts
Charlie Weston

Charlie Weston

There has been a sharp spike in spending - with households shelling out on trips abroad, cars and outings to the cinema.

Spending rose by 5.6pc in June compared with the same month last year, according to the latest Visa Europe Irish spending index.

The card payments company said this represented record growth since it started monitoring the data. Expenditure on online goods and services was also up, they said.

And online spending with travel agencies was up sharply, as the mixed weather prompted people to book holidays abroad.

There was a rise in cinema bookings, as families sought to keep children entertained during heavy downpours.

There was also a notable rise in spending on airline tickets, and on both new and used cars.

Visa measures spending on its debit and credit cards, and adjusts the index to also take account of cash spending.

Country manager for Ireland at Visa, Conor Langford, said June was a record month for consumer spending in this country.

"High levels of consumer confidence have led the Irish public to opt for holidays abroad in order to escape the mixed weather we experienced recently, with our data showing a rise in spending with travel agencies and airlines alike."

Mr Langford said blockbuster movies like 'Jurassic World' also led to a boost for the entertainment sector.

"June was a record month for consumer spending in Ireland, marking the highest increase in expenditure since we started monitoring data for the Visa Europe Irish Consumer spending index."

The index has been tracked for the last 10 months.

He said the growth in consecutive quarters was a real positive in terms of the continued momentum behind the Irish economy.

Meanwhile, record-low deposit rates have meant that savers have a negative view about putting money aside in a bank account.

The Nationwide UK (Ireland)/ESRI Savings Index, which measures overall sentiment towards saving, decreased to 116 in June, from 123 in May.

Three out of 10 people under the age of 50 think that now is a bad time to save their hard-earned cash.

Head of Nationwide UK (Ireland), Brendan Synnott, said low levels of interest paid on savings in banks and credit unions were a problem for consumers.

"The amount of household cash on deposit is increasing. People are still saving with a precautionary motive driven by a rising economy, but they are not happy with the amount they are saving or the return they are getting," he added.

Figures out last Friday from the Central Bank showed that banks reduced the interest rate they pay on deposit accounts further in May.

Households with existing savings are getting an interest of just 1.41pc on average, down slightly in May.

Irish Independent

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