According to the data released by the Central Statistical Office (CSO) on Friday, the stagnant trend of retail trade that had been going on for months continued in July.
Péter Virovácz, chief analyst at ING Bank, commented that the retail data for July clearly show that after a strong upswing in the second quarter, a much more moderate growth could characterize the sector and the economy during the third quarter. The outbreak of the holiday season plays a role in the development of traffic in July, which is more favorable for services than for commercial traffic.
The July retail data is the first to tell anything about the economic performance of the third quarter, but since this data doesn’t say much about services, we can be confident that moderate growth will only indicate that households continue to prefer experiences to things. against. The data does not affect ING Bank’s experts’ expectation that GDP growth could reach 7.7 percent this year, Péter Virovácz wrote.
Gergely Suppan, senior analyst at Takarékbank, also pointed out that households presumably turned to opening leisure activities instead of a pick-up in purchases, as wage dynamics remained strong and the labor market reached pre-epidemic levels. The increase in turnover after the gradual opening will be supported by the full recovery of the labor market, and wage growth in sectors not subject to restrictions will remain dynamic. At the end of the year, the expected pension premium, which can reach HUF 150-200 billion for pensioners, may give further impetus.
According to Takarékbank’s expert, retail turnover may increase by around 3 percent this year. Pre-epidemic levels are expected to be reached in retail by the end of this year. However, the recovery of stores building on foreign customers may be delayed. With nearly 7 percent of retail sales prior to the epidemic coming from foreign shoppers and shopping tourism, the return of foreigners could provide a significant boost later on.
According to Gábor Regős, head of the macroeconomic business of the End of the Century Economic Research, the fact that the economy was able to operate almost without restrictions contributed to the increase in retail turnover in July, but the lower number of foreign tourists still restrained the turnover. From the expansion of retail trade, it is likely that consumption may continue to make a positive contribution to economic growth in the third quarter. Retail sales may expand further in the future, thanks to the resumption of the economy after the crisis and the resumption of high employment and rising wages.
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Source: Portfolio.hu – Gazdaság by www.portfolio.hu.
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