Czech retail sales grew by 1.4 percent year-on-year in June, against a 2.5 percent increase in May, the Czech Statistical Office (CSU) announced Thursday in its not seasonally adjusted data which do not include the automotive segment. Seasonally adjusted retail sales grew by 0.4 percent month-on-month in real terms in June.
The biggest contribution to the growth of sales came from the sale of furniture, lighting equipment and household articles, electrical appliances, radio and television goods, hardware, paints and glass in specialized stores, while stores selling food saw a decline.
In the automotive segment, seasonally adjusted sales increased by 1.7 percent mth/mth in constant prices, and in a yr/yr comparison by 2.9 percent and not seasonally adjusted by 2.6 percent.
Seasonally adjusted sales in hotels and restaurants dropped by 0.6 percent mth/mth, and not seasonally adjusted sales were 2.7 percent down, year-on-year.
The fast growth in the category linked to housing leaves households less money for shopping, CSOB analyst Petr Dufek told CTK.
“For three months running already, retail sales have been growing at a very slow pace. June was no exception in this respect,” he said, adding that people buy less food and other goods.
Vladimir Pikora of Next Finance said consumers were slowing economic growth.
“With the price growth, real wage growth slowed and people therefore spend less. They save more..,” he said.
Inflation is high and people worry about the future, Dufek said.
“The strong crown, which should make goods at shops more attractive, has basically not worked at all yet and can hardly be noted in prices at shops. This is good for e-shops and in particular for shopping abroad, which cannot be seen in the statistics,” Dufek noted.
Raiffeisenbank analyst Ales Michl claims that if retailers want to maintain the shopping dynamics, they will have to cut prices of imported goods and include the influence of the strong crown in their prices.
Year-on-year, adjusted for seasonal and working day effects, sales in retail trade increased by 2.7 percent at constant prices, and with only working day adjustment by 3.2 percent.
Not seasonally adjusted sales in retail trade increased by 1.4 percent, of which the non-food goods sales by 2.8 percent, while sales from the sale of food, beverages and tobacco dropped by 0.8 percent.
Bigger year-on-year growth of seasonally adjusted sales compared to not seasonally adjusted sales was affected, given the same number of working days, by smaller number of Fridays this year as they have a positive impact on retail trade and, in contrast, by bigger number of less favourable Mondays, the CSU said.
Generally, the low growth of sales was most contributed to by the sale of furniture, lighting equipment, household articles, electrical appliances, radio and television goods, hardware, paints and glass in specialised stores, while the growth was slowed down by specialized stores with food, beverages and tobacco.
“The most rapid growth was recorded for insignificant retail trade via the Internet or mail order houses. The yr/yr drop of retail sale of food, beverages and tobacco in specialized stores continued,” the CSU said in its report.
The price deflator related to the corresponding period of the previous year was 103.6 percent in June. The biggest price increase was recorded in stores with food, beverages and tobacco, of which in specialized stores by 9.5 percent, in non-specialized stores by 7.6 percent, the CSU said.
In retail sale via stalls and markets and in other non-store retail sale, prices grew by 5.1 percent, in stores with pharmaceutical and medical goods, cosmetic and toilet articles, prices increased by 4.7 percent and in non-specialised stores with the non-food goods predominating by 2.7 percent.
In contrast, in stores with textiles, clothing, footwear and leather goods prices dropped by 1.5 percent, and in retail sale via mail order houses and in retail sale of second-hand goods by 1.3 percent.
Prices of furniture, lighting equipment, household articles, electrical appliances, radio and television goods, hardware, paints and glass were 0.7 percent down and in retail sale of books, newspapers and stationery, other retail sale in specialised stores prices fell by 0.2 percent, the CSU said.
“Retail sales will not improve dramatically this year owing to the slowing economy. At the end of the year, real sales will grow as inflation will fall. The price deflator is now influenced a lot by yr/yr high prices of food,” said Martin Lobotka of Ceska sporitelna.
Lobotka expects retail sales to grow by less than 3 percent for the whole of this year.
Komercni banka analyst Kamila Fialova also believes retail sales will grow at a slower pace this year.
“In 2008, we expect a growth in retail sales at roughly 4 percent,” she said.
Last year, retail sales grew by a record 6.8 percent, the best result since the year 1997.