At first glance, the latest figures from retail analysts Kantar appears to show a disconnect between how much we are spending and how much things cost
The monthly figures suggest that Irish consumers’ supermarket spending over 12 weeks to the end of March fell by just over €78 million while the price of the products in the same supermarkets climbed by 3.7 per cent.
It would be wrong to draw any comfort from the reduction in spending and right to be alarmed by the rate of grocery inflation because the first of those figures was largely artificial thanks to the times we live in while the second is all too real.
Irish consumers spent less in supermarkets over the period because the world opened up as winter became spring. With virtually all Covid-19 related restrictions lifted, people now have more places to spend their money.
And they have found more convenient – if not always cheaper – ways to feed themselves rather than from supermarkets. With restrictions lifted, people are spending more time and money in pubs, cafes, and restaurants and because the return to the workplace is under way many people are picking up food as they go to and from work in convenience stores rather than from supermarkets.
But make no mistake, as spiralling costs bite, supermarket prices are being pushed up, reaching a rate of inflation not seen in almost a decade with “a marked increase in the average price of staples like bread, butter and toilet paper over the last 12 weeks”.
According to Kanter, inflation, rather than the pandemic, is now the main driver of changes to consumer behaviour in Ireland and with prices only going one way. We can expect those changes to be ever more profound as the year goes on.
