Irish consumers are becoming increasingly reliant on credit to finance their spending, according to figures from the Central Bank.
Credit statistics released by the Central Bank today show private-sector credit rose by €37 billion in 2004, an increase of 26.5 per cent on 2003.
A noticeable trend in 2004 has been the growth in demand for non-mortgage credit such as credit cards and short-term loans, which was possibly buoyed by increased spending during the Christmas season.
The year-on-year growth rate for non-mortgage credit has been accelerating during 2004 and reached 24.2 per cent in December (22.6 per cent in November), compared to 13.5 per cent in December 2003.
Despite perceptions of a slowdown in the housing market, demand for mortgages remained robust in December. The value of new residential mortgages in December was €1.6 billion, the third-highest monthly increase on record.
However, had an individual credit institution not reclassified €320 million of their residential mortgages to other mortgages, the December rise would have been the highest-ever monthly increase.