Fall in August retail sales ‘no great surprise’ given market turmoil

THE growth in retail sales came to a halt in August with new figures showing a decline in sales volume in the month.

The figures from Central Statistics Office (CSO) show retail sales in August were 1.4% lower than July. Sales volume was 1.1% lower.

Some economists pointed to the poor weather deterring consumers from shopping and a general easing from the growth in the first half of the year.

Sales in department stores were down 3.5% compared with July and 4.3% lower than August last year.

Electrical goods sales were down 5.4% and hardware, paints and glass sales were 3.5% lower than in July.

Pat McArdle, chief economist with Ulster Bank, said the fall was “no great surprise” given the negative sentiment resulting from turmoil in the markets and concerns over the outlook for housing.

“Even with this slowdown, it will still be a good year for retail sales with volume growth of 6.5% and goods prices up around 1% giving a total increase in sales values of about 7.5%,” Mr McArdle said.

Goodbody Stockbrokers economist Dermot O’Leary said the slowdown the housing market had affected the figures but that the poor weather over the summer may also have had a role.

He added: “Despite this slight moderation in growth momentum, retail sales continue to advance at a highly impressive pace. There has been no SSIA spending spree evident to any significant degree, which gives us greater comfort in the underlying strength of the Irish consumer. Despite this, it is likely that the final quarter of the year will see sales growth moderate somewhat, but we remain confident that our overall consumer spending forecast of 7% for the full year remains intact.”

According to the CSO figures, over the quarter from May to July, food, beverages and tobacco sales were down 0.9% year-on-year; bar sales were up 0.2%; books, newspapers and stationery were up 8.2%; hardware, paints and glass were up 7.1% and electrical goods sales increased by 16.1%.