Growth of personal consumption continues.
In July this year, the turnover in retail trade grew by 4.5 percent year-on-year in real terms, which is the 23rd consecutive month of consumption growth, reports tportal.hr on September 2, 2016.
The Central Bureau of Statistics announced on Friday its first assessment according to which the turnover in retail trade in July nominally increased by 2 percent, and in real terms by 4.5 percent compared to the same month last year. This is faster growth than a month ago, when consumption rose by 2.8 percent year-on-year.
Such a long streak in consumption growth has not been recorded since the Central Bureau of Statistics monitors this information. During this period, higher growth rate was recorded only in July 2015, when the growth reached 4.6 percent.
Analysts of the Raiffeisenbank Austria (RBA) point out that the growth was accomplished despite relatively high base from last year. “There is no doubt that the continuation of good indicators has been strongly supported by solid results in tourism industry, as well as by seasonal improvements in the labour market. The continuation of positive trends in retail turnover was preceded by improvements in employment indicators. According to recent data, in July there were 1.504 million people who were paying pension contributions, which is 0.4 percent more when compared to the previous month. This is the sixth consecutive month of growth in the number of insured persons on a monthly basis”, say the RBA analysts.
They add that the increase in employment is mostly a result of a larger number of employees in the tourism industry. “Positive trends in employment and the growth in tourism revenues have a positive effect on increase of disposable income and turnover in retail trade. Consequently, positive effects will be reflected on consumer spending as the main component of GDP, which will contribute to continued GDP growth in the third quarter. In the coming months, additional support to real growth of retail turnover will come from the absence of positive annual rates of inflation”, conclude the RBA analysts.
According to the latest data, consumer prices in July fell by 1.5 percent year-on-year, continuing deflationary trends for the third year in a row.
