Irish Economy 2015: The volume of retail sales (i.e. excluding price effects) increased by 3.3% in January 2015 when compared with December 2014 and there was an increase of 8.8% in the annual figure. If Motor Trades are excluded, there was a decrease of 0.1% in the volume of retail sales in January 2015 when compared with December 2014 and there was an increase of 4.8% in the annual figure.
The sectors with the largest month on month volume increases were Motor Trades (+4.5%), Other Retail Sales (+4.0%) and Furniture and Lighting (+3.9%). The sectors with the largest monthly decreases were Food Beverages & Tobacco (-6.3%), Pharmaceuticals Medical & Cosmetic Articles (-6.3%) and Department Stores (-3.2%).
There was an increase of 2.9% in the value of retail sales in January 2015 when compared with December 2014 and there was an annual increase of 5.5% when compared with January 2014. If Motor Trades are excluded, there was a monthly decrease of 0.1% in the value of retail sales and an annual increase of 0.9%.
Conall Mac Coille, chief economist at Davy, commented: "Today’s Irish retail sales data for January show volumes up a massive 3.3% on the month and 8.8% on the year. True, the spectacular growth in the headline number has been largely driven by car sales; however, even excluding motor trades, sales were up 4.8% year-on-year. It is also striking that furniture and lighting sales are up 19.8% on the year, indicating that Irish consumers are sufficiently confident to spend on big-ticket items. The clear picture from the retail sales data is that Irish household spending has made a strong start to 2015. This reinforces our view that Irish consumer spending should grow by 1.8% in 2015 after a modest 0.5% expansion last year.
The spectacular growth in retail sales in January mainly reflected the strong rebound in car sales. Motor trades grew by 17.8% compared with the previous year – with January especially important because of the introduction of the new 2015 licence plate. This is not surprising. The CSO had already announced that new vehicle licences were up 26% on the year in January.
Excluding motor trades, sales volumes actually fell modestly, by 0.1%, on the month but were still up a robust 4.8% year-on-year. Of course, January is also important for the traditional sales season. Department store sales fell by 3.2% on the month but were still up 6.1% on the year. Furniture and lighting sales rose by 3.9%, up a massive 19.8% on the year – the strongest annual growth of all retail sectors in January.
Today’s data also show the positive impact of falling oil prices on Irish households’ disposable incomes. Retail prices fell by 0.3% on the month, down 3.1% on the year. This decline has been largely driven by automotive fuel prices, down 6.7% on the month in January and 12.3% on the year. Falling energy and transport costs are helping to free up incomes to be spent on other items."