First retail sales rise in two years

RETAIL sales rose for the first time in two years in February as car sales surged 30%.

Sales at department stores rose 6.3% from the previous month and increased almost 11% in the year.

Sales of electrical goods rose 3.3% in the month and 3.5% in the year. Car sales included, retail sales rose 3% from a year earlier, the first annual increase since January 2008, according to the Central Statistics Office (CSO). Car sales surged 31% in the year. From the previous month.

Goodbody stockbrokers expect car sales to have a further positive influence on the retail sales averages in the future given, it said, that new car registrations were up 77% annually in March.

National Irish Bank chief economist Ronnie O’Toole said: “The scrappage scheme has had an effect in boosting car sales, although across a range of sectors there are signs that spending has now stabilised. Sentiment continues to improve as fears about job security recede.”

Excluding cars, retail sales rose 1.2% in February from the previous month and were down 3.1% in the year.

Goodbody economist Deirdre Ryan said: “The full-year impact of last year’s tax increases is a further constraint on spending. In all there are many headwinds facing the consumer sector in the current year and we remain of the view that spending will decline further in 2010, by -2%.”

Furniture and lighting enjoyed a solid bounce in February, with sales up almost 15%.

Chief executive of Retail Excellence Ireland David Fitzsimons said: “The February retail sales figures, indicating a slow down in the rate of decline, is very welcome news for our members and points to a more positive outlook for Irish retailing in 2010.

“While the industry is still officially in a state of distressed trading, we are edging closer to a position of like-for-like growth which we hope to report in the second half of this year.”

Brian Devine of NCB stockbrokers said more generally, the global economic data of late has been encouraging.

“Another significant event was the fact that the US decided to delay by a number of months a report due for mid-April, in which it was likely that China would have been labelled a ‘currency manipulator’.

“The delay of this report averts prospects of a trade war and is likely to seeChina revalue the Renminbi gradually over the coming year.

“All-in all the data and events should be positive for world trade and hence Ireland, as one of the most open economies in the world.”