Anyone visiting Ikea in Ireland will find themselves getting more for their money than in the UK and some other European countries.
The Swedish flat-pack furniture specialist has cut the prices of some of its top selling items at its Irish outlets, underlining the impact of the nation's stringent austerity measures. One of the company's most basic but popular 'Billy' bookcases will cost €35 in Ireland – a fall of €4 from the €39 that used to be charged and still is charged in less cash-strapped European countries.
Ireland is not the only country where Ikea is cutting its prices. In Greece the 'Billy' bookshelves have been subject to a 22 per cent price cut. Economists believe that sluggish demand born from increased prudence over personal finance is responsible for the containment and cutting of the prices.
An index compiled by Bloomberg News actually showed that the price of 'Billy' shelves declined in all 13 euro-area countries served by Ikea relative to a global average.
Analysing the index, ABN Amro's head of macro research, Nick Kounis, said it was not surprising to see the cuts as wages are dropping in the worst affected countries.
“These are the kind of adjustments we need to see moving forward," he said. "They will help [these nations] over time to get a boost to exports to offset domestic weakness.”
RSS
