Retail sales down by 0.9% last month

Wednesday 28 May 2014 17.09
Sales of books, newspapers and stationery down in April - CSO
Sales of books, newspapers and stationery down in April - CSO

The volume of retail sales fell by 0.9% in the month of April on the back of lower car sales, pharmaceuticals and books and newspapers.

The latest figures from the Central Statistics Office show that retail sales - on an annual basis - rose by 6.8%.

Retail sales are 7.5% higher on average in the first four months of the year than the same time last year.

When motor trades are excluded, the CSO said there was a rise of 1.6% in the volume of retail sales on a monthly basis and an increase of 4.6% on a yearly basis.

Breaking down the figures, they show that furniture and lighting sales rose by 6.4% in April on a monthly basis, while hardware, paint and glass sales grew by 3.3% and sales of food, beverages and tobacco increased by 2.4%.

The sectors with the largest decreases in sales included the motor trade, where sales dropped 3.8%, pharmaceuticals, medical and cosmetic articles (down 2.2%) and books, newspapers and stationery (down 1.5%).

Today's figures from the CSO also show that the value of retail sales fell by 0.8% in April on a monthly basis, while they rose by 4.4% on an annual basis. If motor trades are excluded, there was a monthly increase of 1.5% in the value of sales and a yearly rise of 2.8%.

Retail Ireland, the Ibec group that represents the retail sector, said today's CSO figures were "encouraging" and will hopefully lead to continued growth for the rest of the year.

The group said that the continued double digit growth in furniture and lighting sales is indicative of a stronger property market. "April's increase is hugely welcomed by a sector of retail that has had a torrid few years," said Retail Ireland's Stephen Lynam.

But he also noted falls in sales in specialised food shops like butchers and bakers, and in book stores, which he said highlighted the continued difficulties for those sectors. 

Commenting on today's figures, Merrion economist Alan McQuaid said that although there is still a general air of caution among consumers, there seems to be a view that the worst is over following the downturn of recent years.

"We remain optimistic that buoyed by an improving labour market, consumer spending will this year for the first time since 2010 make a positive contribution to GDP/GNP growth, and the robust data for the January-April period clearly support this view," the economist added.

Investec economist Philip O'Sullivan said that while it appears that the second quarter of the year got off to a good start from a consumer spending perspective, the delta between volume growth and value growth shows that discounting is still necessary to help get some deals over the line. 

However, he said he expects to see personal consumption make a positive contribution (+1.3%) to the national accounts in 2014, following last year’s 1.1% decline.

Davy economist David McNamara said that some of the increases in the sales of the likes of furniture and lighting may be due to the late timing of Easter, so the May data may give a better steer on the underlying strength of retail sales in the second quarter.