Monday, January 30, 2017

Weaker christmas shopping than expected – E24

Statistics norway (SSB) reported a decline of 2.1 per cent in retail from november to December of last year, according to seasonally-adjusted figures.

It is far weaker than expected. An average of analysts had expected a decline of 0.1 percent, according to Reuters via DNB Markets.

sales volume in most industries fell, with a particularly negative contribution in the sale of food and drink in the grocery stores, ” says SSB.

Stores with sales of electrical goods, clothing, shoes, textiles and utstyrsvarer also had a decline in the seasonally adjusted the volume.

Only a few industries increased sales volume from november to December, and it was ecommerce, building materials, toy shops and pharmacies, according to STATISTICS.

the Crown weakened slightly after the figures. A euro can buy 8,92 million, compared to 8,91 million before the numbers came.

– Weaker than expected

– It came in weaker than both we and market had expected, ” says chief economist Kjetil Olsen in Nordea Markets to E24.

He says that a part of the christmas shopping may have been done in november, and that one should not read too much into figures from a single month.

total household spending on goods decreased 1.7 percent from november to December, shows varekonsumprisindeksen. There was a reduction in all product groups except the purchase and operation of cars. Especially helped electricity and fuel to the decline.

Yet it was varekonsumet in the fourth quarter of 0.6 per cent higher than in the previous quarter.

(Source: SSB)

– These figures jump and bounce the aux in connector, and December is often an uncertain month because of christmas shopping, ” he says.

Desembertallene looks also not so bad if one corrects for the somewhat stronger numbers in the preceding months, he believes.

– These figures are chronically hard to follow from month to month, you need to see it a little bit over time, ” says Olsen.

Drag interest rates down

Also, DNB Markets believe that a part of the consumption was done in november instead of December, because of the handledagen “Black Friday”.

– Especially forbrukstallene suggest a weak start in 2017, and points to the Norges Bank’s estimates of consumption (2,0%) is on the optimistic side, writes Kyrre Aamdal at DNB Markets in a comment.

in Isolation, this will contribute to lower rentebane, but Norges Bank will also get januarindeksen before the next meeting. Continued solid growth in the housing market acts as an effective barrier to further rate cuts, he writes.

Also for 2016 total declined sales volume in the retail sector. The decline was 1.5 percent from the year before.

Increased import prices

part of the reason that the sales volume goes down, can be inflation on imported goods, believes Olsen in Nordea Markets.

It is one of the negative effects of a weaker crown, which overall is good for the Norwegian economy, but fraraner households with some purchasing power, ” he says.

– It is very different than what we are accustomed to, ” he adds.

the rate of Inflation on imported goods will probably come down somewhat in years, and it can have a positive effect on the retail industry, according to sjeføkonomen.

We are relatively optimistic on behalf of the retail sector for 2017. We think it will be a better year than 2016, ” says Olsen.

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