The volume of retail sales increased in August 2016 by 5.8 percent, double the average EU growth rate, compared to the same period of the previous year. Thus, the sector has been expanding for the 38th month in a row. In the initial eight months of the year, the volume of retail sales was up by 5 percent year-on-year. Analysts are expecting this upward trend to continue in the remainder of the year.

In August 2016, calendar-adjusted data showed a year-on-year increase of 4.3 percent. The difference between these and unadjusted data stems from the fact that there were three more working days in August this year compared to last year. Since January 2010 and the beginning of 2014, the volume of retail sales grew by 17 percent and 14.0 percent, respectively, in Hungary.

As far as the composition of sales is concerned, sales in the the non-food sector gained 6.1 percent. At specialized and non-specialized food retailers, the volume of sales grew by 2.8 percent year-on-year.  This is an especially favourable sign, as families to tend to have a balanced food spending pattern and the volume of food sales was above the pre-crisis record high level already in 2014. Parallel to steadily low oil prices, fuel prices declined by 11.4 percent year-on-year, and this has led to sales increase of 7.5 percent.

The disposable income growth of families is exceeding the growth observed in retail sales, and this signals a firm savings trend. Thanks to wage increases and rising consumer confidence, household spending is expected to rise more in 2016 than formerly estimated by the Convergence Programme.

(Ministry for National Economy)