Eurozone retail sales drop less than expected in August

Retail sales dipped 0.1% from July, beating expectations of a 0.3% decline. On the year, however, they were up 0.6%, missing forecasts of a 1.5% increase.

Sales of automotive fuel were up 0.2% in the eurozone, while sales of food, drinks and tobacco fell 0.4% and non-food products were down 0.1%.

In the EU-28 group of nations, sales were 0.1% weaker on the month and 2.1% higher on the year.

Eurostat said on Wednesday that eurozone retail sales in July rose 0.3%, which was down from an initial estimate of a 1.1% increase. The figure for the year was also revised down, to a 1.8% gain from 2.9%.

Pantheon Macroeconomics said the headline was relatively upbeat compared to consensus, but the key story was the significant downward revision of the July data, due to a downward adjustment in the final German data.

“This points to a subdued outlook for EZ retail sales growth over Q3 as a whole compared to our initial estimates. Assuming a year-over-year rate of 1.5% in September, retail sales will rise 0.4% quarter-on-quarter in Q3, up only marginally from the disappointingly weak 0.2% in Q2. Consumers’ spending in the Eurozone continues to support growth, but momentum has waned.”