Consumption grows for 21st consecutive month

Retail trade in May 2016 grew by 3.9% on the year, which is the 21st month in a row retail trade has increased, at a higher-than-expected rate.

The national statistical office (DSZ) on Tuesday published a preliminary estimate showing that according to working-day adjusted data, retail sales grew 1.3% in nominal terms and 3.9% in real terms from May 2015.

Four economic analysts polled by Hina had predicted an annual increase of 2.9%, with their estimates ranging from 2.7% to 3%.

The increase in consumption is owing, among other factors, to an increase in salaries. According to DZS data, from January to April this year the average monthly net salary in corporate bodies amounted to HRK 5,663, a real increase of 3.1% from the same period of 2015.

May was also the second consecutive month to record an increase in employment, with the number of employed persons going up 1.9% from April (around 25,000 more employed persons).

Analysts at Raiffeisenbank Austria (RBA) note that May was the fourth consecutive month to see a strong increase in the number of car registrations, of 21.8% on the year.

The figures released by the DZS show that consumption continued to grow strongly also in the second quarter, which heralds continued economic growth.

A 3.1% increase in personal consumption was one of the most important drivers of GDP growth, which in the first quarter was 2.7% higher on the year.

RBA analysts expect consumption to continue growing given the approach of the peak tourist season and more intensive seasonal employment.

(Text: Hina)

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