Retail sales in Romania surged by 8.6% y/y in 2024 in volume terms, driven by the double-digit (+14.8% y/y) rise in non-food sales, according to data published by the statistics office INS.

The private consumption was driven up by the 7.6% y/y rise in the real net wage and the unusually sharp rise in the volume of “new consumption loans”: +73% y/y to RON 47.0 billion (EUR 9.5 billion) in 2024, counting only the local currency denominated lending. The “new consumption loans,” although including a significant volume of refinancing, account for a significant volume in relative terms: roughly 1.5 months of net wages earned by the 5.75 million employees in the country.

Non-food sales advanced at a more modest rate, by only 3.8% y/y, while car fuel sales advanced by 3.6% y/y.

Romania’s private consumption thus accelerated in 2024, from a modest 1.6% y/y advance in 2023 and 4.5% y/y in 2022, returning to its buoyant performance after the slowdown caused by the war in Ukraine intermediated by the higher lending rates and lower real wages: the net wages contracted by real 1.4% y/y in 2022, but gradually returned to growth in 2023-2024.

Private consumption is expected by the state forecasting body CNP to lose momentum in 2025, to a real advance of only 2.5% from 5.3% in 2024.

Although lending may remain robust, wages will probably rise at lower rates: by some 2.2% in real terms, according to CNP’s forecast.

iulian@romania-insider.com

(Photo source: Tero Vesalainen/Dreamstime.com)