Retail sale number in eurozone fell unexpectedly in September as the largest economy of the bloc – Germany, did not perform to expectations with sluggish non-food sales, according to Eurostat statistics released on Friday.
Retail sales in the 19 eurozone nations decreased 0.3 per cent month on month in September but was up by 2.5 per cent year on year, according to the European Union’s statistics office. Retail sale is widely considered to be a measure of consumer demand.
Reuters surveyed economists who had predicted a 0.3 per cent monthly gain and a 1.5 per cent year-on-year increase in retail sales for the month.
Part of the month-on-month shortfall, however, may be due to adjustments and revisions, as retail sales for August are now believed to be higher by 1 per cent compared to the previously reported number of 0.3 per cent growth.
According to analysts and economists, in the coming few months, it is being expected that consumers would become more cautious about spending primarily because of an ever increasing costs for fuel and energy along with rising numbers of Covid-19 infections in the region as well as continued issues of supply chain bottlenecks.
The cautious spending approach of consumers in eurozone can already be seen in PMI data that exhibited that there was a decline in business growth in October to a level that was lowest in the past six months.
Analysts also expect household purchasing power to get stifled because of high petrol prices as families will be left with less money to pay for other goods.
There was a 1 per cent month on month rise in car fuel sales, while sale of food, drinks and tobacco increased by 0.7 per cent, according to data from Eurostat.
At the same time however, there was a 1.5 per cent fall in non food sales, which included a 1.4 per cent drop in Internet and mail order sales.
The largest drop of 2.5 per cent in retail sales was reported from Germany, the biggest economy of the euro zone. The retail sale numbers from Finland and the Netherlands were also quite bad and were significantly in the negative territory.
(Adapted from TheGlobeAndMail.com)