Dublin shoppers ramped up spending in the fourth quarter of 2022 despite the ongoing stagnation of tourist spending in the capital, mostly due to declining expenditure among US visitors, a MasterCard report has found.
The payments company’s Spending Pulse report for the final three months of last year indicates the value of retail spending increased 1.2 per cent from the period between July and September. Spending was also up 6 per cent on the fourth quarter of 2021 when some Covid-related public health restrictions remained in place.
MasterCard said these growth rates are in line with “typical retail activity levels for the capital”, representing “a more normalised level of activity” compared with the period after the economy reopened last year.
But it said the rates are lower than the rate of inflation – which averaged 8.9 per cent on an annual basis between October and December, according to Central Statistics Office figures. This indicates that rising prices contributed to the increasing value of sales in the quarter and that spending “in real terms is declining”.
The value of spending on entertainment in the capital, the sector in which the largest increased was observed, increased 4.6 per cent in the quarter, the slowest rate of growth over the five preceding quarters.
Nationally, overall spending grew 4 per cent in the year to the end of December, mostly driven by entertainment, which expanded at a rate of more than 41 per cent. MasterCard said the performance of the entertainment sector over the quarter highlights “the lingering appetite for hospitality among consumers in Dublin”.
Meanwhile, the value of tourist expenditure in the capital “largely stagnated” in the final months of the year, the report indicates, declining 1 per cent from the start of the quarter to its end.
“Declining expenditure among American visitors to the capital appears to be the main contributory factor,” MasterCard said. “Spending by visitors from that market dropped by 6.8 per cent quarter-on-quarter in the final quarter. Despite this, the fourth quarter was far more encouraging in terms of quarter-on-quarter spending growth among visitors from Dublin’s other key tourist markets – notably the UK (+17.6 per cent), Germany (+15.7 per cent) and France (+8.7 per cent).”
Michael McNamara, global head of MasterCard’s spending pulse division, said: “Overall, retail sales growth rates of 6 per cent year-on-year for Dublin and 4 per cent year-on-year for Ireland are in a range that is more typical for general retail economic activity. Some sectors, such as entertainment, remain elevated as we continue to recover from some suppressed activity a year ago, though many sectors are showing more typical growth in the low-to-mid single digits.”