Consumer spending has fallen for the second time in three months, according to Visa’s Irish Consumer Spending Index.
Having risen slightly during January, consumer expenditure was down by 0.6pc on a year-on-year basis.
This was the sharpest reduction in real spending recorded for two years, as falling consumer confidence continues impact spending habits.
The fall in spending comes on the back of growing concerns about the potential impact of a possible no-deal Brexit, as well as research from Bank of Ireland this week, which found that one in three people are “very worried” about their finances.
Meanwhile, last month sentiment among consumers fell to its lowest level since November 2014.
Face-to-face consumer spending fell by almost 4pc year-on-year in February, however in contrast eCommerce spend rose 5.6pc on an annual basis.
Last month consumers increased their spend on household goods and hotels and restaurants and bars, which recorded growth rates of 7.6pc and 6.7pc respectively.
There was also some growth seen in health and education, up 3.2pc, and a modest increase seen in recreation and culture, which recorded growth of 1.2pc.
However, spending fell in all other categories covered by the report, most notably in the traditional retail categories of food and beverages, which was down 1.3pc, and clothing and footwear, down 3.8pc.
This was the first decline reported in the food and beverages sector in 18 months.
The sharpest reduction in spending was for “miscellaneous” goods and services. This segment includes jewellery, health and beauty.
Expenditure in this category was down 5.3pc, a fall that was broadly in line with January’s four-year record fall.
Philip Konopik, Ireland country manager, Visa said: “While the likes of the hotels, restaurants & bars and recreation & culture sectors saw a boost in February thanks to the mid-term break and Valentine’s day, this failed to drive sales on the high street with spending down -3.9pc year-on-year.”
“Overall it represents a sluggish start to the year, so hopefully we will see an uptick in consumer spending to coincide with St Patrick’s day.”
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