THERE WERE conflicting signals on the state of the economy yesterday with core retail sales in August rising for the first time since March, while a separate survey of the manufacturing industry in September saw the first contraction since April.
The figures suggest, respectively, the domestic economy may be stabilising and the export-focused manufacturing sector is cooling.
The volume of retail sales, which strips out the effects of price changes, rose by 0.2 per cent in August on July, according to new figures from the Central Statistics Office. This measure is seasonally adjusted and excludes the the highly volatile motor trade.
Disaggregated by sector, the August figures show notable month-on-month volume increases in car sales, up 5.5 per cent; department store sales, up 4.6 per cent; and in pharmaceuticals, medical and cosmetics sales, up 3.2 per cent.
Declines were recorded in non-specialised stores sales, which were down 0.5 per cent, and in sales of clothing, footwear and textiles, which fell by 0.1 per cent.
On an annual basis, significant increases in sales volumes were recorded in six categories, including motors, up 20.4 per cent; non-specialised stores, up 1.3 per cent; and clothing and footwear, up 1.4 per cent.
In the 12-month period under review, there were declines in sales volumes in seven categories including furniture and lighting, which were down 10.4 per cent; and bars, down 10.3 per cent.
According to the figures, only the motor trade and fuel showed year-on-year value increases in August, while all other categories showed annual declines in values.
The licensed trade continues to suffer with drink sales in bars among the biggest annual sales declines – down 12.7 per cent.
Clothing, footwear and textiles were down 6.5 per cent.
A separate survey showed that Ireland’s manufacturing sector shrank for the first time in seven months in September. It had been performing strongly over 2010, mostly on the back of a strong rebound in exports.
The NCB Purchasing Managers’ Index, which measures Irish manufacturing activity, fell to 48.4 from 51.1 in August, dipping below the 50 mark separating growth from contraction for the first time since February.
“Irish GDP, after expanding in the first quarter on the back of impressive manufacturing output, contracted once again in the second quarter,” said Brian Devine, economist at NCB Stockbrokers. “The manufacturing sector has slowed even further in Q3.”
The sub-index measuring new export orders fell to 49.5 from 54.5 in the previous month, the first fall since October 2009.
