Polish retail sales grew 3% y/y in constant prices in March, slowing from a solid 6.2% expansion recorded the previous month, data from statistics office GUS showed on April 18.
Although the reading was relatively strong, the dynamic in retail sales matches feeble industrial production growth reported the same day, raising concern in some quarters of a slowdown in the economy. The market had expected an expansion of 5.7%.
Still, the growth is there in March, testifying to forecasts that private consumption will remain a major pillar of economic growth, as it was in 2015. That outlook is supported by a tightening labour market and the government’s child benefit programme, which launched this month.
In monthly terms, retail sales increased 13% following growth of just 1.3% in February. In current prices, sales increased 0.8% y/y, and 14% m/m.
Sales grew in most segments on an annual basis. The fastest growth came in the textiles segment, where sales expanded 11.9% on the year. Solid growth was also recorded in pharmaceuticals, which increased 10.6%, while sales of food increased 6.4%. Fuel sales dipped 4.5%, on the other hand.
Despite the dynamic, analysts insist they are not too worried about the economy. “We’re not convinced that this marks the start of a sharp slowdown," Capital Economics writes. "The activity data tend to be volatile from month to month, and survey data have remained relatively strong. More fundamentally, the economy should benefit from looser fiscal policy and improving labour market conditions. As a result, we think it’s more likely than not that growth will strengthen in Q2.”