Growth in household expenditure increased in July despite uncertainty following the United Kingdom's vote to leave the European Union, according to Visa Europe.
The financial services company’s Irish Consumer Spending Index reported expenditure across all payment types (cash, cheques and electronic payments) was up 6.4 per cent year on year. The increase follows a 6 per cent year-on-year increase in spending in June.
Household spending has risen throughout the 23 months of the series so far, with the latest increase greater than the average over this period.
Ecommerce
Spending via ecommerce categories continued to drive the overall increase in expenditure, with spending rising 9.9 per cent year on year during July. That said, this was the slowest expansion since March.
High-street expenditure, meanwhile, rose at a faster pace than in June (4.8 per cent from 1.9 per cent), with growth also sharper than the average for this series so far.
The recreation and culture category signalled the fastest rise in spending and was the only sector to post double-digit expansion in July (11.5 per cent year on year).
Rates of growth in the household goods, transport and communication and health and education sectors also dipped from June but remained solid.
Meanwhile, improved rates of expansion were seen in the food, beverages and tobacco, clothing and footwear and hotels, restaurants and bars categories, with the former posting its strongest increase since February.
Consumer sentiment
Visa Europe’s Ireland manager, Philip Konopik, said the impact of economic uncertainty had yet to affect Irish consumer sentiment.
“While there is some economic uncertainty at the moment, we have not seen an impact on Irish consumer expenditure as yet with household spending continuing to rise,” he said.
“The overall rate of growth in July was slightly stronger than the 23-month series average and all sectors saw an increase in spending during the month.”
Markit senior economist Andrew Harker said the figures were positive for high-street retailers.
“There was no sign of a let-up in spending by Irish consumers in July, with growth actually picking up slightly from June,” he said.
“There was some positive news for the high street as face-to-face expenditure rose at a faster pace and sectors such as hotels, restaurants and bars and clothing and footwear appear to have particularly benefited from this.”
