Soaring car sales behind July retail rise

Retail sales received a boost from the motor sector last month as volumes increased by more than 8%.

Statistics released by the CSO yesterday show that motor sales jumped by 36% in July compared with the previous month as new 142 registration plates gave sales volumes an expected bump.

When the performance of the motor industry is removed, the overall picture is less positive as core sales fell 0.7% month-on-month.

Merrion Stockbrokers’ chief economist Alan McQuaid said that while monthly spending patterns remain erratic, the figures reveal a marked improvement on the same period last year. “Consumer spending remains erratic on a monthly basis, though on a year-on-year comparison it is well up on the same time last year, which is encouraging. There have been clear signs of stronger personal expenditure, particularly in relation to new cars, concert tickets and online internet shopping, he said.

“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.”

In terms of both volume and value, the figures represent the ninth successive month of growth on a yearly basis — a pattern mirrored by core sales which rose by more than 3%.

Apart from motor sales, books, newspapers and stationary sales (4.3%) and electrical goods (1.5%) experienced the strongest gains last month.

The largest month-on-month volume decreases were furniture and lighting (-10.7%); fuel (-8.8%) and other retail sales (-6.4%). The greatest annual fall was in bar sales (-5.4%.

Mr McQuaid predicted that consumer spending , buoyed by an improving labour market, will contribute positively to GDP for the first time since 2010.