Good weather brings out the sun for shops as food sales get a boost
NEW retail statistics which show a small general rise in consumer spending have been greeted by economists as "encouraging".
The country might officially be back in recession, but the latest figures from the Central Statistics Office (CSO) show the volume of retail sales rose by 0.1pc in May when compared with the previous month – though sales were down 0.7pc on an annual basis.
However, if the motor trade is excluded, the volume of retail sales was up 1.4pc in May compared with the previous month and there was no change in the annual figure.
The strongest sales were seen in the seasonal area of DIY, with hardware, paint and glass up 14pc. Food, beverages and tobacco sales were up by 5.2pc, perhaps pointing to good weather barbecues last month.
Meanwhile clothing, footwear and textiles were up 3.8pc. Property prices were up 0.3pc in May, the second consecutive monthly rise. But the sharpest drops were seen in the motor trade – down 5.5pc – and the books, newspapers and stationery sector, which was down 3.9pc.
Economist David McNamara of Davy Research described the broad-based nature of the rise as "encouraging", explaining that they had been looking to this new data for signs of recovery in consumer spending following the sharp fall in sales in the first quarter of the year.
Meanwhile he said the rise in property prices shows that prices have now recovered some ground following the New Year slump.
And he said the "exceptionally weak" level of car sales might be partly explained by the changes in the licence plate system, with consumers potentially holding off on purchases until the second half of the year.
Dermot O'Leary of Goodbody Economics also welcomed the CSO figures, saying they suggest that consumer spending will not be a drag on economic growth in the second quarter.