Euro area retail sales fall in December, but higher for Q4

Retail sales in the single currency bloc fell back at the end of 2018, with those for textiles and via mail orders or the internet sporting the biggest declines, but economists pointed out how sales in fact rose in quarterly terms.

The volume of retail trade decreased at a month-on-month clip of 1.6% in December, as expected by economists.

But the variations for October and November were both revised higher by two tenths of a percentage point to reveal increases of 0.8% for each month.

Sales of non-food products fared worst in December, falling by 2.7%, with those by mail or the internet dropping by 6.1%, while those of textiles declined by 2.9% and those of electrical goods by 2.1%.

Food, drink and tobacco sales on the other hand dipped just 0.3%.

From among the Eurozone's largest economies, German retail sales were weakest, dropping by 4.3% versus November, while those in Spain fell by 1.2% and those in France by only 0.1%.

In comparison to a year ago, euro area retail sales grew by 0.8% (consensus: 0.5%).

Commenting on the data, Claus Vistesen at Pantheon Macroeconomics said: "This is a horrible headline, but we doubt that it is a telling the true story. [...] Black Friday sales are now a thing in Europe, and in general, consumers tend to use sales periods in October and November to push forward Christmas purchases.

"Seasonals are yet to catch up to this shift in behaviour. In addition, we suspect that the German headline will be revised up in due course. In addition, the December plunge is not reflective of the Q4 story as a whole. Indeed, the data now indicate that sales increased by 0.6% quarter-on-quarter, up from a flat Q3, signalling that consumers’ spending picked up a bit towards the end of the year."