Significant Surge in Czech Retail Sales as Consumer Spending Increases

In a recent turn of events, Czech consumers have started to reclaim their purchasing power, as evidenced by the noticeable increase in retail sales in March. According to the Czech Statistical Office (ČSÚ), retail sales have been on an upward trend for the fourth consecutive month, with a significant acceleration in March. The retail sales increased by 6.1% year-on-year and 1.3% month-on-month.

The ČSÚ reported that sales have increased across all major store categories for non-food and food items. In the case of non-food goods, statisticians recorded a year-on-year increase of 7.7%. For example, sales at specialized stores with cosmetic and toiletry products increased by more than a quarter. Clothing and footwear stores recorded a growth of 5.2%.

Sales in food stores increased by a flat four percent, while sales of motor fuels increased by 6.7%. Online and mail-order businesses witnessed a nearly 15% jump in their sales.

The surge in spending was confirmed by Tomáš Volf, an analyst at Citfin, who noted that “Czechs have finally started spending more. The trend looks very good at first glance.” However, he also pointed out that retail sales fell by 9.5% in March last year, so the low base of comparison significantly contributed to the positive figure this year.

According to Petr Dufek, Creditas Bank’s chief economist, the numbers exceeded expectations. But like Volf, Dufek also pointed to the low comparison base from last year. “Easter was a bit earlier this year, so the effect of preparing for these holidays could have played its role,” he added.

In conclusion, Czechs’ desire to shop is gradually returning. After two years of extreme inflation by local standards and the associated decline in purchasing power, the situation is beginning to return to its original tracks this year. Notably, household consumption will likely be the main driver of the economy this year.