Retail sales grew in April at their slowest rate so far this year, but economists said there was no cause for concern and that consumer spending remains strong.

The volume of retail sales increased 3.9 per cent in April compared with the same month a year earlier, according to figures released yesterday by the Central Statistics Office (CSO).

Compared with the prior month, sales volumes slipped 1.5 per cent.

Excluding motor trades, the annual increase in sales volumes was 1.6 per cent, while the monthly figure dropped 2.4 per cent.

"There is a lot of volatility on a monthly basis, but if you look at the three-month average, the increase is very impressive," said Philip O'Sullivan, an economist at Goodbody Stockbrokers.

According to this data, retail sales grew by 5.6 per cent in April from the same month in 2004.

The figures were boosted by an increase in sales in the motor trade, which recorded the biggest sectoral rise in April of 10.1 per cent from the year-earlier month.

"The motor trade had a stonking start to 2005," said Mr O'Sullivan, adding that he expected to see this trend continuing in 2006 and 2007 as the SSIA payments are made.

"A car is the ultimate big ticket item and it's what a lot of people will be wanting to spend their money on," he said.

Meanwhile sales volumes at Ireland's bars continued to decline, dropping 5.7 per cent in April from the year-earlier month.

Mandate which represents thousands of bar workers, said the decline should not be attributed to the smoking ban because the slowdown was already evident before the ban was introduced.

It is more likely linked to last year's major increase in bar prices, said John Douglas, the union's general secretary.

Goodbody's Mr O'Sullivan said it was comforting to see strong sales of hardware and paints, which increased by 8.4 per cent in April from the year-earlier month, according to yesterday's preliminary figures.

"It's a good sign when consumers are prepared to invest in the more durable, long-term items," Mr O'Sullivan said.

Sales of textiles and clothing, and footwear and leather, both increased 5 and 2.4 per cent respectively, showing that as well as the larger, more expensive items, consumers are continuing to spend on day-to-day goods.

"Overall these are good numbers and especially in the context of what we are seeing elsewhere," said Eugene Kiernan, head of asset allocation at Irish Life Investment Managers.

Compared with the rest of Europe, Ireland is performing strongly. Irish retail sales grew 5.6 per cent in March, the latest period for which Europe-wide figures are available, beating the 3.3 per cent increase in the UK and 0.8 per cent in France.

"There's certainly no signs of a slowdown here," said Goodbody's Mr O'Sullivan.

"There's no doubt the Irish economy has outperformed everywhere else in Europe.

Goodbody is forecasting a 4.5 per cent increase in consumer spending this year, followed by a 6.7 per cent jump in 2006.

The value of retail sales increased 5.3 per cent from April 2004, also the slowest rate this year.