Retail sales of domestic retail trade enterprises increased by 7% y/y in constant prices to EUR 405.6mn and to EUR 315 per capita in May, according to Statistics Estonia. The growth rate of retail trade previously dived in February to 2% y/y, but recovered to 7% y/y in March. In April retail trade growth moderated to 5% y/y.
May’s increase in retail trade growth is a positive signal as on the background of unfavourable external environment all eyes are on domestic demand. Last month, the Bank of Estonia, revised the GDP growth forecast for 2013 from previous 3% to 2%. The main reasons behind the worsened outlook is the contraction of domestic demand and fixed capital investment (its growth is seen slowing down to 2%).
In May, retail trade in stores selling manufactured goods went up by 11% y/y and as usual this had the largest impact on aggregate trade performance. Sales increased in all economic activities in May. Grocery stores that usually account for about 50% of increase/decline in retail sales posted a 3% y/y growth. However, this is to be attributed partly to discount campaigns.
In 2012, the overall retail trade turnover remained strong at 7% y/y vs. 4% y/y growth in 2011, 4% y/y decline in 2010 and 15% y/y drop in 2009
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