Polish retail sales grew 5.2% y/y in constant prices in December, statistics office GUS announced on January 19.

The reading marks a slowdown in the pace of growth after turnover expanded 8.8% y/y in November. The smaller number of working days in December – two fewer than in the same month in 2016 – is the main cause of the reduced growth rate. Overall, private consumption, fuelled by the tightening labour market, remains the key driver of economic growth.

With industrial production growth also strong in December, the Polish economy continues to be in rude health and on course for an annual GDP growth of around 5% in the fourth quarter, according to Bank Millennium. Poland’s GDP accelerated to 5.2% y/y in the third quarter.

“Growing real incomes, high consumer confidence and negative real interest rates will be conducive to consumption growth in the coming quarter, although the growth dynamics will fade a bit,” the bank said.

The growth in retail sales in December was broad, with all but one segment experiencing expanding sales. Sales growth of food, drinks, and tobacco products came in at 2.8% y/y in December, while sales of fuel expanded 1.9% y/y. 

Sales of furniture and domestic appliances expanded 7.5% on the year, while retail trade in textiles, clothing, and shoes boomed 24.2% y/y. Sales fell only in the “other” category, dropping 1.3% y/y.

In monthly terms, retail sales jumped 16.6% in constant prices. In current prices, retail sales grew 6% y/y and 16.6% m/m in December.

Throughout 2017, retail sales expanded 7.3% in constant prices and 8.4% in current prices.