Retail sales rebound in August – CSO
Retail sales increased 2.1% in August on an annual basis, new figures from the Central Statistics Office show today.
On a monthly basis, the CSO said that retail sales jumped by 5.7% in August compared to July.
Excluding the motor trade, which has been very volatile in recent years, retail sales grew by 1.1% in August and 4.4% when compared with the same time last year, today’s figures show.
In July, retail sales had posted their sharpest annual fall since 2012 on weak car sales.
Today’s CSO figures show that the sectors with the largest monthly increases were the motor trade, with sales there jumping 12% higher, while bars sales rose by 10.6%.
The sectors with the largest monthly decreases were fuel with sales down 4.4%, while sales of pharmaceuticals, medical and cosmetic articles slowed by 3.3%.
Meanwhile the CSO figures also show an increase of 5.8% in the value of retail sales in August on a monthly basis, while there was an annual increase of 0.9%.
Car sales slump drives Ireland’s retail activity 4.3pc lower in July
An unseasonal slump in new car purchases drove Ireland’s retail sales sharply lower last month, the Central Statistics Office reported on Wednesday.
Sales declined by 4.3pc in both value and volume terms versus June levels, chiefly because many Irish car hunters are opting to buy cheap used UK imports on the back of the British pound’s Brexit-fuelled weakness.
Irish car dealers recorded a 13pc sales slump by volume in July, despite the arrival of 192 plates, which normally would be expected to spur increased sales of new vehicles.
Pubs and bars also experienced a 6.4pc drop-off in the volume and value of beverage sales.
However, excluding the exceptionally weak performance of the motor trade, Irish retail sales overall grew last month, rising 1.9pc in volume and 1.3pc in value versus June.
Supermarkets and other non-specialised stories led the growth table, with sales up by 5.7pc in volume and 5.4pc in value. Department stores recorded more muted gains of 1.9pc and 1.2pc, respectively.
Sales of pharmaceutical, medical and cosmetic articles were 4.7pc higher by volume and 4pc by value, while sales of hardware, paint and glass rose by 2.5pc and 3.5pc, respectively.
The volume of sales in Ireland is 4.4pc lower than a year ago, again chiefly because of the decline of new car sales. Excluding the motor trade, retail sales have risen by 4.2pc over the past 12 months.
Wall Street rises on strong retail sales data; recession fears remain
US stocks rose in choppy trading today, as strong July retail sales data and Walmart’s upbeat results eased some fears about the economy slipping into recession.
However, a slump in shares of network gear maker Cisco limited gains.
Cisco Systems Inc dropped 6.2% and was the biggest drag on all three major indexes, after the Dow component blamed the bruising US-China trade war for poor quarterly forecasts.
The bounce on Wall Street comes a day after the blue-chip Dow index posted its worst day this year, as recession fears gripped the market following the inversion of the US Treasury yield curve for the first time in 12 years.
“It doesn’t matter where we are right now. The number of variables affecting this market are increasing,” Andre Bakhos, managing director at New Vines Capital LLC in Bernardsville, New Jersey said.
The Commerce Department said retail sales rose 0.7% in July, well above expectations of a 0.3% rise, as consumers bought a range of goods even as they cut back on motor vehicle purchases.
“The July number shows that the weakest economic data that people keep pointing out to for a global slowdown is coming from outside the US, not inside the US,” Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin.
Walmart shares rose 5.3% after the retailer reported second-quarter US comparable sales that beat estimates and boosted its earnings forecast for the year.
Keeping investors on edge were mixed reports on trade.
China’s finance ministry said it would retaliate to the latest US tariffs.
However, a spokeswoman for the ministry later said, “We hope the US will meet China halfway, and implement the consensus of the two heads of the two countries in Osaka.”
Trade worries have plagued financial markets for at least a year, fuelling fears of recession and prompting traders to raise their bets on three rate cuts this year, including one in September.
The benchmark S&P 500 is now about 6% away from its all-time high hit in July.
Second call of online retail initiative opens
The Minister for Business, Enterprise and Innovation Heather Humphreys has opened the second call of Enterprise Ireland’s Online Retail Scheme.
The Scheme, an initiative of the Government through Enterprise Ireland, offers a total of €1.25 million in funding to online retailers.
The funding supports research, strategy development, implementation and training.
It aims to enhance retailers’ online sales capabilities and increase their competitiveness as they scale their businesses to international markets.
“Increasing the international sales of Irish companies translates into sustaining and creating high-quality, sustainable jobs across the country — something that this Government is firmly focused on,” Ms Humphreys said.
“Aligned with this, the Online Retail Scheme is intended to enable Irish retailers to expand their reach to a wider customer base both at home and abroad.”
Stephen Hughes, Head of Consumer, Enterprise Ireland, said the Scheme was “developed in response to the challenges currently faced by the retail sector in keeping up with consumers’ ever-changing appetite for quick and easy consumption and the advances in digital capability.”
“At least half of the total number of funds will be awarded to Irish retail businesses based outside of Dublin,” Mr. Hughes projects, highlighting “the important role played by retailers in regional communities.”
Any Irish-owned retail business with 10 or more employees and a physical retail outlet can apply for funding ranging from €10,000 to €25,000.
The six-week application period opens on Wednesday, 19th June and closes at 3pm on Wednesday, 31st July.
The move has been welcomed by trade organisation, Retail Excellence, which said it would give Irish retailers the resources to respond to external challenges like exporting in Q4 in a difficult post-Brexit environment, flat consumer confidence and increasing business costs.
“While we’re clear that today’s Call 2 launch is most welcome, the fact is that this scheme has been rolled out on a pilot basis, so it’s a step in the right direction,” said Bryan Rankin, Head of Public Affairs with Retail Excellence.
“However, the level of State support and financial intervention needs to be far more ambitious, in our view.”
“We will be working with Minister Humphrey’s office to scale up funding to a level that can impact positively on the thousands of retailers that sell Irish products and services online.”
Mild weather so far this year boosts Irish retailers
A new report shows that the value of retail sales rose by 4.7% in the first quarter of the year, boosted by a mild winter and early spring weather.
The Retail Monitor, from Retail Ireland – the Ibec group that represents the sector – said there was a “modest uptick” in consumer confidence coming off the back of some respite from Brexit uncertainty.
While the first quarter figures are robust, Retail Ireland stressed that Ireland had been under a blanket of snow and was suffering the disruptive effects of Storm Emma in the first quarter of last year.
The Monitor shows that while sales are up across almost all categories of retail, the trends of discounting and the continuing shift to online are also evident.
This is especially evident in categories such as computers and electrical goods and department stores.
Retail Ireland said the main driver in the supermarkets and convenience stores sector continues to be competitive action with the battle for market share between multiples very intense and the slower but continuing growth of discounters also contributing to downward pressures.
A buoyant economy has been good news for the convenience sector, which is also in growth, it added.
The first quarter represented a solid quarter for the pharmacy sector with strong January sales.
Retail Ireland noted that beauty categories were strong across Valentine’s Day. But seasonal healthcare was soft with the exception of hay fever, which saw an early boost due to milder weather.
It added that the timing of Easter and Mother’s Day was challenging in March, but the quarter remained moderately positive year on year.
Meanwhile, the DIY and hardware sector saw strong growth, helped by the early kick off of the gardening season and this year’s more favourable weather conditions.
But sales of fashion and footwear continue to fluctuate, affected by issues such as increased competition from online UK shopping platforms and changes in the value of sterling.
Retail Ireland also noted that the price of both petrol and diesel at the pumps increased from 137.6 cent and 127.1 cent in April last year respectively to 142.3 cent for petrol and 137 cent for diesel in the first quarter of this year.
Thomas Burke, Director of Retail Ireland, said that after a rocky fourth quarter of 2018, in which trade ebbed and flow almost by the day, retailers will be hoping that a level of consistency to trade can be found in 2019.
Mr Burke said that retail sales patterns in the second half of 2018 were heavily impacted by Brexit related commentary and the extension to the negotiating period until October seems to have calmed nerves somewhat.
“The daily game of brinkmanship is no longer leading news bulletins, and for hard-pressed Irish retailers this is good news,” Mr Burke said.
“On the back of this we have seen an uptick in consumer sentiment as people’s worst fears of a crash out Brexit, have been allayed, at least for the moment,” he added.
Looking ahead, Mr Burke said that many businesses will have budgeted against the performance of Summer 2018.
“For those categories that are particularly reliant on good weather to drive footfall and sales, clearly this will prove challenging. With no guarantee of a similar prolonged spell of fine weather retailers will have to be creative if they are to achieve such heights once more,” he stated.
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