The retail sales volume index increased by 6.4% y/y in Q1, Romania’s statistics office INS announced.
The sales of non-food goods have particularly leaped up by 12.3% y/y, witnessing robust consumer confidence and heralding the return of private consumption as a significant growth driver this year.
At the same time, the strong retail sales readings don’t bode well for the trade balance that has stabilized nominally through 2023 and decreased as a share of GDP, still accounting for some 9% of GDP in 12 months to February (latest data available).
Non-food sales increased by only 1.8% y/y, although the food prices increased by only 4.3% y/y compared to the 7.7% y/y rise in non-food prices in Q1.
The sales index surged by 5% q/q in Q1, driven by the 9.3% q/q advance of non-food sales.
The households’ rising budgets were visibly at the origin of retailers’ robust overall performance in Q1. At the same time, the discrepancy between the dynamics of food and non-food sales reveals the still wide and possibly rising income disparity.
The net wages rose by 6.4% y/y in January-February on average (latest data available), and the volume of new consumer loans extended by banks surged by 83.5% y/y in Q1, adding to households’ earnings and boosting their purchasing power.
iulian@romania-insider.com
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