Data from Eurostat showed that retail sales declined by 0.2% in July, offsetting the 0.2% increase in June (revised from -0.3%). Economists had expected a 0.1% decline. Consumption has been sluggish as real incomes are falling and households are spending most of their income on expensive energy and on credit and mortgage repayments, eroding demand for other goods.
In annual terms, retail sales fell by 1% after a similar decline in June (revised from -1.4%). Consensus estimates suggested a 1.2% drop. As for the EU countries, retail sales fell by 0.3% on a monthly basis and by 1.2% compared to July 2022.
The data showed that in the eurozone the volume of retail trade decreased by 1.2% for automotive fuels, while it increased by 0.4% for food, drinks and tobacco and by 0.5% for non-food products. In the EU, the volume of retail trade decreased by 1.1% for automotive fuels, while it increased by 0.2% for food, drinks and tobacco and by 0.6% for non-food products.
The annual drop in retail sales in the eurozone was caused by a decline in trade in automotive fuels (-3.4%) and food, drinks and tobacco products (-2.2%). Meanwhile, sales of non-food products increased by 1.1% per annum.
As for the EU countries, the largest yearly decreases in the total retail trade volume were registered in Slovenia (-16.3%), Estonia (-8.6%) and Hungary (-7.6%). The highest increases were observed in Spain (+8.6%), Cyprus (+8.0%) and Luxembourg (+6.9%).