Eurozone retail sales continue to struggle

(Sharecast News) - Retail sales fell in the Eurozone in January, official data showed on Thursday, as the European economy struggled to gain momentum. According to first estimates from Eurostat, the European Union's statistical office, the volume of retail trade fell 0.3% in January month-on month.

That was down on December's print, of 0%, and below consensus for a 0.1% uptick.

In the wider bloc, retail sales eased 0.2%.

While food, drinks and tobacco sales moved higher, up 0.6%, that was offset by falls in non-food products and automotive fuel.

Among individual member states, sales in Germany - the bloc's biggest economy - ticked up 0.1%. That compares to a 0.8% decline in December. However, in France they fell 0.1%, and by 0.4% in Italy. Spain's data was not available.

Year-on-year, sales volumes in the Eurozone in January were 1.5% higher - below the 1.9% expected by analysts - and 1.6% stronger across the entire EU.

Bert Colijn, chief economist, Netherlands, at ING, said: "January marks the fourth consecutive month without growth in sales volumes, with the Eurozone's retail sales now 0.6% below the peak observed in September.

"The softness in sales volumes is remarkable, given the fast recovery in purchasing power; wage growth far outpaces inflation at the moment, resulting in quick real wage recovery. However, this has yet to translate into a robust rebound in consumption.

"This year, we expect the improved purchasing power to translate into stronger consumption. The degree to which that happens very much depends on whether consumers feel confident to spend the increased amount of money in their pockets."