In November 2011, seasonally adjusted retail sales went down 0.7% compared with October while compared with November 2010, they increased 0.5%, according to the figures published by the Czech Statistical Office (ČSÚ). Although the results beat market expectations, no trend of improvement in household consumption may be expected, according to Komerční banka analyst Miroslav Fray. The structure of sales remained unchanged in November, with year-on-year growth being driven by the motor vehicle segment. Sales from the sale and repairs of motor vehicles jumped 2.5% in real prices, according to the Czech Statistical Office. The segment of non-food goods saw a rise in sales, too (+1.7%), while the sale of food products and fuels went down 2.8% and 2.2% respectively. Marie Konečná, Partner of the Tax Consulting Department at KPMG Czech Republic, said that the pre-Christmas period was reflected only in Internet sales.
According to the Czech Confederation of Commerce and Tourism (SOCR), the drop in the final consumption and household consumption could be seen in 2011. Overall retail sales in real prices are expected to grow 1% on average last year, but in nominal figures, the rise may be higher as a result of the impact of reform and market measures on consumer prices, the Confederation said. Between January and November, aggregate retail sales climbed 2.7% on the year in nominal figures and 1.9% in real prices. The real decline in the sale of food products is apparent, as sales grow amid lower consumption. The opposite development could be seen in the sale of non-food products and cars where more units were sold at lower prices.
A one per cent drop in retail sales may be expected this year, according to Komerční banka. Retail stagnation in 2012 is rather an optimistic scenario also for the SOCR. A further decline in consumption will probably be the main trend this year. According to the October forecast of the Ministry of Finance, consumption will drop 0.5% both in households and government institutions. The decline in the number of customers will be compensated by higher prices. In the food sector, the Confederation expects a high rise in food prices by 5 - 10% by the end of the first half of 2012. No major price rise is expected globally, as many entrepreneurs made gradual and preventive price increases before the end of 2011.
Source: Česká informační agentura, s.r.o. (www.cianews.cz)
