Bad weather a factor in falling June retail sales

The volume of retail sales fell by 1

The volume of retail sales fell by 1.9 per cent in June compared with the previous month, according to the latest data from the Central Statistics Office (CSO).

However, the seasonally adjusted retail sales volume rose by 6.5 per cent in June. This compares with 10.1 per cent in May.

If motor trades are excluded, the annual increase in June was 5.1 per cent and the monthly change was a fall of 3 per cent.

The value of retail sales rose by 7.3 per cent in June compared to June last year, but fell by 1.7 per cent in the month.

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Poor weather more than likely played a role in the slump in retail sales in some categories, according to Dermot O'Leary, chief economist with Goodbody Stockbrokers. "Spending on all categories of retail sales slowed in the month of June," said Mr O'Leary.

"The most significant decline, however, came in the hardware, paints and glass category.

"This category can be used as a proxy for DIY goods. According to the CSO, sales volumes fell by 13 per cent month on month in June.

"Given the scale of the decline, it can be reasonably assumed that weather played a big role in this performance."

Nevertheless, on a three-month moving average basis, sales volumes in the hardware, paints and glass category were still ahead by 11 per cent year-on-year in June.

Overall, retail sales volumes grew by 7.8 per cent year-on-year in the second quarter of the year, the fastest quarterly rate of growth since the third quarter of 2000.

"Clearly, the rate of spending growth achieved in the second quarter of this year cannot be maintained in an environment of slowing employment growth," said Mr O'Leary.

"Nevertheless, we are loath to suggest that the slowdown in June represents the beginning of this moderation, given that weather undoubtedly played an important role in the outcome."