The last quarter of last year was disappointing for euro zone retailers and little improvement is forecast for 2025.
Seasonally adjusted retail trade volume In the Eurozone, it increased by 0.1% in November 2024 compared to the previous month. According to data Published by Eurostat on ThursdayRetail trade volume increased by 0.3% in October and 0.5% in September. Meanwhile, retail trade volume in the European Union increased by 0.2%, following -0.1% in October and 0.4% in September.
“Total sales are still well below “Since the November 2021 high and pre-pandemic trend,” Andrew Kenningham said. Chief European Economist at Capital EconomicsHe noted that “the post-pandemic recovery has been disappointing.” The eurozone has seen a rise in inflation in 2022, partly due to supply chain disruptions related to the Covid virus and the war in Ukraine.
Although price growth has cooled and the ECB remains on track to cut interest rates, the euro zone retail sector continues to be negatively affected by tight financial conditions.
Strong retail trade in Cyprus and Bulgaria
The increase contributed to the 0.1% increase in November increase in trade in automobile fuels (0.8%) and increase in sales of food, beverages and tobacco (0.1%). Trade in non-food products Excluding automobile fuel, it decreased by 0.6% month-on-month. Comparison of Member States with available data, biggest increases Total monthly retail trade volume recorded Cyprus (2.3%), Bulgaria (1.3%), Denmark you Latvia (both 1.1%).
The biggest decreases were recorded in Belgium (-2.4%), Germany and Spain (both -0.6%), Poland and Finland (both -0.2%). France recorded a monthly increase of 0.3%.
Predictions for next year
Looking ahead to 2025, Andrew Kenningham noted: “rising real incomes, moderate job growth and falling interest rates should support consumption.” However, he said a moderate recovery was more likely than a strong recovery because real incomes would grow at a slower pace next year. Due to real income increase Peter Vanden Houte, chief economist at ING Belgium, said in a statement to Euronews: “The weakness in retail sales in November was due to a lower desire to spend rather than a decrease in the desire to spend.” lack of purchasing power“.
“One of the reasons for the loss in consumer confidence is the expectation that unemployment will increase. This has probably led to an increase in precautionary savings,” he explained. Vanden Houte added that a significant acceleration in retail trade is not expected before the second half of 2025.
“There is still a lot of uncertainty in the coming months. “It’s about the new US president, but it’s also about the difficult political situation in France and Germany,” he said. “Also, the fear of rising unemployment in many European companies, especially in the German manufacturing sector, will not go away in the short term.” Restructuring and layoffs announced“.
