Eurozone retail sales fall more than expected

(Sharecast News) - Retail sales in the eurozone fell for the first time in four months in October, reversing gains made the month before, according to figures out on Thursday from Eurostat. The government agency reported that the adjusted volume of retail trade decreased by 0.5% across the single-currency region during the month of October, following a 0.5% gain in September.

This was first fall in sales volumes since June and the steepest rate of decline since December 2023, coming in below the consensus forecast for a fall of just 0.3%.

Compared with October 2023, sales were up 1.9%, with the annual growth rate slowing from 3.0% in September.

Eurostat said that a 0.1% monthly increase in sales of food, drinks and tobacco was outweighed by a 0.9% drop in sales of non-food products and a 0.3% fall in sales of fuel.

The largest monthly drops in sales were recorded in Belgium (-1.7%), Germany (-1.4%) and Cyprus (-1.1%), while the strongest growth was seen in Luxembourg (+2.4%) and Lithuania (+1.5%).

Alexander Valentin, senior economist at Oxford Economics, said the monthly drop in sales was expected due to "stagnant numbers" in most countries and a significant decline in the region's largest economy, Germany.

"However, consumption likely expanded healthily in Q3, and we expect that rising real incomes will support demand in the near term although a softening labour market poses a risk," Valentin said.