The retail sales volume increased by 8.6% y/y in November and 7.9% y/y in the 12 months to November 2024, according to data published by the statistics office INS. 

Although the figures are broadly in line with the overall macro landscape (robust growth of households' income, imports rising faster than exports), there is an unusual detail in the sales data, namely the step-like advance (some 10%) of the non-food retail sales as of January 2024, which suggest a change in methodology such as the addition of several categories concomitant with the re-basing of the index at the beginning of last year.

Retail sales growth was driven by stronger wages (+7.6% y/y in 12 months to October, in real terms, latest data available) and pensions (+16.1% y/y, real terms, in Q3, latest data available). The softer advances in households' income and more cautious consumer sentiment this year are likely to result in the more modest performance of the retailers.

In turn, the stronger demand for private consumption pushed up imports, which advanced by 2.8% y/y in 12 months to November despite subdued industrial activity that pushed down exports by 1.5% y/y in the same period.

The non-food sales surged by double-digit rates: 14.3% y/y in November and 13.3% y/y in the 12-month period, demonstrating households' robust consumer confidence.

The volume of services, typically associated with purchasing power, increased more moderately, by only 2.8% y/y in November and 2.2% y/y in the 12-month period. However, the average net wage increased by 7.3% y/y in October (latest data available) and 7.6% y/y in the 12 months to October, in real terms.

The volume of food sales advanced by 3.9% y/y in November and 4.3% y/y in 12 months to November.

iulian@romania-insider.com

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