Consumers splash out on travel, defying cost-of-living squeeze

Irish shoppers splashed out on trips abroad, clothing and takeaways last month, defying the cost-of-living squeeze, new data from fintech Revolut has indicated.

The digital bank’s consumer spending report for January suggests consumers were in much better form last month than January 2022, when some Covid restrictions remained in place before being lifted at the end of that month.

Revolut customers spent 67.7 per cent more on travel last month than in January 2022, with a sizeable 178.3 per cent increase in the number of customers booking their holidays through travel agents.

Additionally, spending on hotels (+35.8 per cent) and airlines (+55.5 per cent) increased year on year in January. Spending on cruises increased 144.5 per cent and saw a 40 per cent increase in transaction volumes.

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The sharp increase correlates with the lifting of Covid-related travel restrictions across the globe last year, which have significantly boosted passenger numbers to and from Irish ports and airports over the past 12 months.

[ Consumer spending and inflation bolster Government’s VAT receipts ]

Shoppers also spent 14.3 per cent more in supermarkets in January compared with last year, probably due to the impact of food price inflation.

The Central Statistics Office (CSO) will publish the January consumer price index on Thursday. Food and non-alcoholic beverage prices increased 11.7 per cent in the 12 months to the end of December, according to the most recently available CSO data.

Restaurants also felt the benefit of the Irish consumer’s improved disposition, according to Revolut’s latest figures, with the value of restaurant spending up 32.5 per cent.

With spending on entertainment up by an overall 15.3 per cent, shoppers spent more in museums (+120.4 per cent), cinemas (+35 per cent) and theatres (+45.3 per cent).

Taking advantage of the January sales, shoppers also splashed out more on clothing, with shops seeing a 23.5 per cent increase in the value of consumer spending, and 20.5 per cent increase in transaction volumes over the 12-month period.

“Despite inflation boosting the rise in consumer spending, the relaxation of Covid restrictions has contributed to the increased number of customers and transactions across several industries,” a Revolut spokesperson said. “From trips to the theatre, refreshing wardrobes in the January sales, and dining out, it’s encouraging to see that consumers are finding ways to budget for treats and experiences. Furthermore, January saw a huge rise in travel spending and the revival of the travel agency.”