Hungarian retail sales dropped by 0.5% month on month in April, according to data adjusted for calendar and seasonal effects, the Central Statistics Office (KSH) has reported on Monday. This was the fourth consecutive month when the KSH detected a m/m decline. In March the statistics office reported “only" a 0.1% m/m drop.
Accordingly, the indicator gauging changes in the past 12 months has also dropped. The 2.5% yr/yr decline is the greatest fall detected in this decade. The only country in the European Union that produced an even bigger decrease was Belgium. Portugal is also closely behind Hungary, but in the rest of the member states statistics show greater propensity to purchase.
The trend gives reason for concern also because it shows that the impact of the government austerity measures was not merely a one-off dip, but a prolonged decrease. On the other hand, this indicates that consumption smoothing is not as strong as it was assumed it would be, i.e. consumers do not hold back their purchases as drastically as the drop in real wages would warrant them to.
The gradual loss of momentum becomes evident when we examine that while the KSH detected a 0.2% yr/yr volume rise in Q1, there was already a 0.4% yr/yr drop in the January-April period.
All this undermines the conclusion several experts drew from first-quarter GDP numbers. Better-than-expected consumption data suggested that internal engines of growth would only slow down but would not halt. In light of the fresh data, we cannot be so sure about that.
The aforementioned trends may be observed in vehicle retail sales figures, as well. Combined sales of cars, car parts and fuel (not a part of European statistical systems) was HUF 185 billion in April, down 7.6% yr/yr against a 3.6% drop in March and a 2.9% decline in February.
Retail sale of cars and car parts dipped by 16.6% yr/yr in April (vs. -10.8% in March). Up to date, the KSH detected a decline of 8.5% in this category.
Fuel sales were up 3.1% yr/yr in the fourth month, down from a growth of 5.9% in March. The Jan-Apr increase came in at 5.0%, down from 5.8% in Q1.
Hungarian retail sales totalled HUF 500.1 billion in April at current prices, up from HUF 473.3 bn in Mar, also up from HUF 476.1 bn in April 2006.
Calendar-adjusted food sales fell 0.8% yr/yr in April, against a 0.6% decline in the previous month and +3.8% yr/yr in April 2006.
On a month-on-month basis there was a 0.1% fall here in the fourth month, unchanged from March.
From the beginning of the year, the KSH detected a 0.3% decrease in this category.
Non-food sales dipped by 3.8% yr/yr versus a 0.4% increase in Mar, and +3.6% in April 2006.
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