Consumer spending falls but domestic tourism shows resilience

Consumer spending fell for the first time since January last month, but there were positive signs for industries supported by domestic Irish tourism, according to the AIB Spend Trend for July.

The data shows spending overall fell by 0.5 per cent, but hotels saw a 13 per cent increase in spend, while spend in pubs and off-licences rose 11 per cent, and restaurants saw a 5 per cent increase. Spending on groceries also rose by 2 per cent.

All other sectors saw a decrease in spending, with airline travel seeing a decline of 8.5 per cent.

Reflecting the increase in domestic travel, Dubliners’ spending rose in every county except for Kildare and Longford. They increased their spending by 55 per cent in Wexford, 53 per cent in Kerry, 26 per cent in Cork and 16 per cent in Galway.

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The data was compiled from over 1 million card transactions by Irish consumers during July and has been anonymised and aggregated. All comparisons are based on July versus June data unless otherwise stated.

Overall, spending was down 0.5 per cent in July compared to the previous month as consumers spent almost €87 million a day throughout the month.

Digital wallet payments were up 6 per cent as consumers spent almost €13 million a day using the technology on their devices, counting for one in every seven euro spent during the month.

July 29th, coinciding with pay day for many people and the Friday of the August Bank Holiday weekend, was the busiest day of the month for consumer spending.

Spending was down in clothing (-7 per cent), electronics (-1 per cent) hardware (-5 per cent) as well as health and beauty (-6 per cent) and homewares (-4 per cent).

AIB head of SME banking John Brennan said: “While overall spending in July fell slightly, spend in establishments that are supported by Irish tourism saw a significant increase.

“As is typical in the later summer months when fewer holidays are being booked, consumers spent less on airline travel, but spending in the sector is much higher than last year when Covid-19 travel restrictions were still prominent.

“Digital wallet payments are up 6 per cent, showing how increasingly popular the cashless payment method is becoming with the public. They are now spending nearly €13 million euro a day by tapping their phones and watches.

“This is equivalent to nearly €1 in every €7 during the month being spent via a digital wallet.”