The third consecutive monthly drop suggests that consumers are struggling with stubborn inflation and elevated borrowing costs.
8 November 2023
September retail sales in the Euro area fell by 0.3% on the month, slightly worse than the forecast of a 0.2% drop. However, on a positive note, the latest fall is modest compared to the 0.7% slide seen in August. This could signal that volumes are gradually reacting to less pernicious inflation across the region and holding up better than some had feared.
Sales of food and drink (and tobacco) increased by 1.4% over the month and this is where much of the inflationary price increases has been centred over the last year, so to see an increase is reflective of consumers reacting to a slowdown in appreciating prices seen across these sectors. At the headline level, overall retail activity is now 2.9% lower year-on-year and until this trend reverses, recessionary clouds will continue to build on the horizon.
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The information in this document is given for information purposes only and does not qualify as investment advice. Opinions and assessments contained in this document may change and reflect the point of view of GAM in the current economic environment. No liability shall be accepted for the accuracy and completeness of the information. Past performance is not an indicator for the current or future development.