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Volume of retail sales seen higher this year

Calendar-adjusted data show that in January 2016 the volume of retail sales grew by 2.2 percent year-on-year, compared to an already high base last year. This positive trend is expected to continue in coming months, as a result of steadily high consumer confidence, the reduction of the personal income tax, higher wages in real terms and the record-breaking employment level.

In the first month of the year, unadjusted data show year-on-year growth of 1.7 percent in the sales volume of retailers. As far as the composition of sales is concerned, the non-food sector posted growth of 6 percent, which signals that the upward trend, in place for a year-and-a-half, has continued. This figure also reflects the remarkable sales growth at mail-order service providers (15 percent). The volume of sales rose by 12 percent at retailers of furniture and electrical goods, by 11 percent at textiles, clothing and footwear shops; by 10 percent at second hand stores; by 4 percent at books, computer equipment and other specialized stores, and by 0.8 percent at pharmaceutical, medical goods and cosmetics shops. The 1.4 percent growth registered in the sales volume of specialized and non-specialized food stores was mainly attributable to the fact that sales volumes in this sector had reached and even surpassed the pre-crisis level already in 2014. Sales of fuels rose by 4.4 percent, due partly to the 5.4 percent price increase.

Retails sales data confirm that household spending has picked up as families have turned more optimistic about income outlook. Further sales growth is predicted for this year, underpinned by factors such as rising real wages, record-high employment, higher tax allowance for families with two children, the reduction or phasing-out of certain fees and duties, the reduction of VAT on pork from 27 percent to 5 percent as well as the lowering of the personal income tax rate by 1 percentage point.