Weak Eurozone Retail Sales 📉 Is Fuel Demand Falling?

Eurozone retail sales rose by just 0.1% month-on-month in August, following a 0.6% decline in July. The result came in below expectations for a 0.2% increase and points to only a very cautious recovery in consumer demand. After a weak July, household spending stabilized somewhat, particularly outside the fuel segment, but it is still too early to speak of a broad and strong rebound in consumption.

• On an annual basis, retail sales volumes increased by 0.8% year-on-year, up from a revised 0.4% increase in July. This marks some improvement from the previous month, although the overall pace of consumption growth remains weak.
• The composition of the data was somewhat better than the headline suggested. Non-food sales excluding automotive fuel rose by 0.5% month-on-month, partially reversing July’s 1.2% decline, while sales of food, drinks and tobacco increased by 0.1%.
• The main drag came from automotive fuel sales, which fell by 1.9% month-on-month. On a yearly basis, fuel sales volumes were down 3.7%, while non-food sales rose by 1.7% and food sales increased by 1.6%.
• Performance across the largest economies was mixed. Germany rebounded by 1.3% month-on-month after a 3.2% decline in July, Spain rose by 0.3%, and Italy by 0.1%, while France recorded a 1.1% decline.
• The underlying composition was somewhat stronger than the headline figure implied. Non-food sales excluding automotive fuel increased by 0.5% month-on-month, partially recovering from July’s 1.2% drop.
• Sales of food, drinks and tobacco rose by 0.1% month-on-month, while automotive fuel remained the main drag, falling by 1.9%. On a yearly basis, fuel sales volumes were down 3.7%, while non-food sales increased by 1.7% and food sales by 1.6%.
• The picture across the largest economies was mixed. Germany rebounded by 1.3% month-on-month after a 3.2% fall in July, Spain rose by 0.3%, and Italy by 0.1%, while France posted a 1.1% decline.

Source: Eurostat