New registration plates boost retail sales for July

Retail sales increased by 6.1 per cent in July compared with the same month in 2012, boosted by high volumes of car sales. The rise was driven primarily by the motor trade which increased by 37.4 per cent during the month, most likely as a result of the introduction of the 132 registration plate this year. There were 9,306 new private cars licensed last month, compared with 6,164 in July 2012.

Books and stationery surge
With car sales excluded, the volume of retail sales increased by 1.3 per cent in the month. Sales of books, newspapers and stationery increased by 16.2 per cent, while clothing, footwear and textiles rose 5.3 per cent. The sectors with the largest monthly decreases were electrical goods, which fell by 4.9 per cent, and fuel, which dropped 4.2 per cent. Economist at Merrion Stockbrokers Alan McQuaid said the July data points to a strong rebound in the third quarter but was cautious new car sales would continue to rise for the rest of the year.

Consumer confidence
"The main factor impacting on consumer demand has been the continued net decline in real disposable incomes, an increasing tax burden and an erosion of transfer income. But there are indications that slowly but surely consumers are becoming more confident and starting to spend again," said Mr McQuaid.

He added unemployment had peaked in February last year and fell steadily since and that a continuation would create stronger sales. “There is now every possibility spending will post a small positive gain, which . . . will be reflected in higher GDP growth.”