PRAGUE, Oct 14 (Reuters) - Czech retail sales fell 3.5
percent year-on-year in August, more than analysts' forecast,
data showed on Wednesday.
It was the eleventh monthly decline in a row and evidence of
a continued second wave of the economic crisis, which has been
underscored by rising unemployment, stagnant wages and a fall in
household spending.
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KEY POINTS:
(change in percent) Aug July Aug forecast
RETAIL SALES (y/y) -3.5 -4.9 -2.0
(Click on [] for full table of Aug retail sales)
DETAILS:
- The headline, unadjusted figure includes car sales and
repairs, fuel sales and spending on a variety of consumer goods,
including foodstuffs.
- Seasonally-adjusted retail sales dipped by a real 0.3 percent
month-on-month, while dropping 3.6 percent year-on-year in
August.
- Car and maintenance sales fell by a real 10.1 percent
year-on-year.
COMMENTS:
DAVID MAREK, CHIEF ECONOMIST, PATRIA FINANCE
"The figures are proof that the Czech economy is out of
recession, but domestic demand is not. Demand in the near-term
will fall and the reasons are certain -- in the case of retail
sales it is growing unemployment and stagnating wages."
"This trend will be prolonged by the fact that state sector
wages will decrease next year."
"So we can say that the rebound in the Czech economy will
come from the euro zone, not from domestic demand."
PETR DUFEK, ANALYST, CSOB
"No surprise from retail sales. Consumers are saving and
postponing buying expensive goods till better times."
"Car sales as well as the entire retail sales show this.
Only food sales are rising, which is likely due to their
declining prices. The rest of sales is falling."
"The outlook is not particularly positive, unemployment is
rising and in the next year we will see a drop in real wages, so
a turnaround is still far ahead."
"On the other hand, the drop in retail sales creates
pressure on retailers to cut prices. A drop in prices is... a
reason to expect low inflation and plays for interest rate
easing."
MICHAL BROZKA, ANALYST, RAFFEISENBANK PRAGUE
"The data on car registrations indicated the possibility of
an even better result, but in contrast, the weak labour market
and low consumer sentiment led to caution."
"The story has stayed the same and retail sales are weak.
The August numbers were also helped by weak data in August 2008.
For the whole year, we expect a fall in retail sales of 5.0
percent and in 2010, we expect a 2 percent fall."
MIROSLAV FRAYER, ANALYST, KOMERCNI BANKA
"It shows that overall household demand is still weak. The
reason is the worsening on the labour market. People are worried
about their future so they spend less and rather save."
"While the overall economy is probably past the worst, from
the labour market point of view the worst is only to come, and
unemployment may peak at the turn of the first and the second
quarters (of 2010)."
"For monetary policy, this indicates the economy probably
need another boost, and it plays in favour of another rate cut."
BACKGROUND:
- September consumer inflation [
[ID:nL9353663]
- August industrial output figures []
[]
- Report on last Czech c.bank rate decision.......[]
[] [] []
LINKS:
- For further details on August retail sales and past data,
Reuters 3000 Xtra users can click on the Czech Statistical
Bureau's website:
http://www.czso.cz/eng/csu.nsf/kalendar/2004-slu
- For LIVE Czech economic data releases, click on <ECONCZ>
- Instant Views on other Czech data []
- Overview of Czech macroeconomic indicators []
- Key data releases in central Europe []
- For Czech money markets data click on <CZKVIEW>
- Czech money guide <CZK/1>
- Czech benchmark state bond prices <0#CZBMK=>
- Czech forward money market rates <CZKFRA>
(Writing by Jana Mlcochova)
