Retail

Euro Zone Retail Sales Fall As Expected In August

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Euro zone retail sales fell in August, data showed on Thursday, pointing to a weakness in consumer demand and underlining expectations of an approaching recession.

The European Union's statistics office Eurostat said retail sales in the 19 countries sharing the euro fell 0.3% month-on-month for a 2.0% year-on-year drop.

Economists polled by Reuters had expected a 0.4% monthly fall and a 1.7% year-on-year decline.

Consumer Demand

The fall in retail sales, seen as a proxy for consumer demand, underlines economists' expectations that the euro zone is likely to go in to a recession in the coming quarters, hit by the energy price shock created by the Russian invasion of Ukraine.

The sales decline in August came despite a sharp rise in the volume of sales of car fuels during the holiday season, which rose 3.2% month-on-month and 5.1% year-on-year, but failed to offset falling sales of food and drinks and internet or mail order shopping.

Non-food retail sales overall did rise by 0.2% in August, although that was down 3.0% from a year earlier.

Inflation

In September, Euro zone inflation zoomed past forecasts to hit a fresh record high, reinforcing expectations for another jumbo interest rate hike from the European Central Bank in October.

Elsewhere, German inflation was at its highest in more than a quarter of a century in September, driven by high energy prices, data showed, as analysts warned that the energy crisis has yet to make itself fully felt.

News by Reuters, edited by ESM – your source for the latest retail news. Click subscribe to sign up to ESM: European Supermarket Magazine.

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