| Consensus | Actual | Previous | |
|---|---|---|---|
| Month over Month | -0.2% | -0.2% | 0.8% |
| Year over Year | 3.4% | 4.4% |
Highlights
Following surprising strength in November, retailers saw sales slide at year-end. That said, a 0.2 percent monthly fall failed to fully unwind the mid-quarter's unrevised 0.8 percent gain and matched the market consensus. Unadjusted annual growth dropped from 4.4 percent to 3.4 percent.
However, nominal sales continue to be boosted by rising prices and volumes were much weaker, dropping a monthly 0.7 percent. This more than unwound November's 0.4 percent gain. Indeed, real sales have risen only once in the last five months and now stand at their lowest level since April 2021. Both purchases of food (minus 0.6 percent) and non-food (minus 0.8 percent) posted fresh falls.
December's modest decline puts quarterly volume sales growth at minus 1.8 percent meaning that the retail sector subtracted from GDP growth, as it has every quarter since the start of 2022. Even so, while the ECDI (minus 3) is close to zero, the ECDI-P (16) shows that overall real economic activity is still performing a little better than market expectations.
However, nominal sales continue to be boosted by rising prices and volumes were much weaker, dropping a monthly 0.7 percent. This more than unwound November's 0.4 percent gain. Indeed, real sales have risen only once in the last five months and now stand at their lowest level since April 2021. Both purchases of food (minus 0.6 percent) and non-food (minus 0.8 percent) posted fresh falls.
December's modest decline puts quarterly volume sales growth at minus 1.8 percent meaning that the retail sector subtracted from GDP growth, as it has every quarter since the start of 2022. Even so, while the ECDI (minus 3) is close to zero, the ECDI-P (16) shows that overall real economic activity is still performing a little better than market expectations.
Market Consensus Before Announcement
Sales are seen falling a monthly 0.2 percent after a 0.8 percent rise in November.
Definition
Retail sales measure the total receipts at stores that sell durable and nondurable goods. The headline data are expressed in nominal terms but volume statistics are also available. Autos are excluded. Only a very limited breakdown of subsector performance is available in the first report but much greater detail is provided in the following month's release. The Italian National Institute of Statistics (Istat) is the main producer of official statistics in Italy.
Description
With consumer spending a large part of the economy, market players continually monitor spending patterns. Retail sales are a measure of consumer well-being. The pattern in consumer spending is often the foremost influence on stock and bond markets. For stocks, strong economic growth translates to healthy corporate profits and higher stock prices. For bonds, the focus is whether economic growth goes overboard and leads to inflation. Ideally, the economy walks that fine line between strong growth and excessive (inflationary) growth.
