Polish retail sales grew 4.6% y/y in constant prices in October, statistics office GUS announced on November 21.

The reading is weaker than September’s growth of 6.3% y/y, and dents somewhat hope for a GDP growth rebound in the final quarter of the year. The Polish economy expanded at a disappointing 2.5% y/y in the third quarter, on the back of poor investment and industrial output.
 
In monthly terms, retail sales grew 3%, after falling 1.4% in September. At current prices, growth pushed to 3.7% y/y and 3.9% m/m.

Sales grew in all but one basic retail segment on an annual basis at constant prices. The quickest gain came in the pharmaceuticals and cosmetics segment, which grew 16.5% on the year. That was followed by the 14.2% increase in the “other retail sales in the non-specialised stores” segment. Sales of food, drinks, and tobacco products increased 3.7% on the year, while fuel sales expanded 0.9%.

Analysts see the October reading as disappointing, however. "The data are surprising because they still do not show the effect of the child benefit programme on consumption," Bank Millennium complains.

"The benefit money may not be spent on consumption of goods, but on services as well as for saving and paying off debt," the bank speculates. With consumption the main driver of growth in absence of positive signals on investment and industry, the lack of thrust from the child benefit programme may not spell good news for economy.