Forex »

Irish Retail Sales Growth Slows

James Boston
Share on StockTwits
Published on
www.finances.com
Irish Retail Sales Growth Slows

The expansion in Irish Retail Sales has declined for the fifth month in a row according to information released by the country’s Central Statistics Office this morning. The year on year reading is now showing at 4.8% for the month of June, down from the previous month’s 5.5%, consensus estimates had predicted a reading over 8.0% for the month. The actual month on month number came in at a negative -1.7% compared to a print of 0.4% in May, the forecast was for 0.6% growth on this occasion.

The country is experiencing a significant pick up in confidence as growth predictions look set to top 2% this year. There are signs of an improvement in unemployment however for now this appears to be confined to the higher skilled end of the market.

A recent re-examination of Ireland’s Debt/GDP ratio appears to point to a lower level of indebtedness, the current official figure is 123.4% but this falls to 116% when certain cash reserves at the national treasury agency are included in the figures.

The recovery in Ireland still has some way to go before it can be deemed stable, there is at least one more austerity budget due later this year but a higher than expected tax take means that this will be mild in comparison to the some of the previous budgets, the danger to the economy is coming from the cumulative dampening effect that the series of five austerity budgets is having.

The European Central Bank is due to stress test the Irish banking sector at the end of this year, many of the Irish banks are still in state ownership and there is a concern that the stringent stress testing will result in the need for more capital, should this be the case then the public debt will rise accordingly. Fortunately, there has been a surge in house prices over the past twelve months, and this will assist the banks in making it through the ECB’s stress test process.

Share on StockTwits