Norwegian retail sales growth accelerate in June
Norwegian retail sales rose in the month of June. On a sequential basis, retail sales grew 5.7 percent, accelerating from May’s rise of 2.8 percent. Today’s data came in above expectations. The retail sales index is 13.1 points above than its pre-lockdown level of 103.6 in February. The extreme rise is still explained by a shift from consumption of services to goods. Moreover, reduced travelling abroad is likely to have increased spending, said DNB Markets in a research report.
The goods consumption index rose 5.3 percent sequentially in the month after rising 4.5 percent in the prior month. Goods consumption is c42 percent of total private consumption in the national accounts.
The solid reading of June is still a reflection of two main factors. Firstly, households still have the willingness and ability to spend, in spite of the overall activity being at low level in the economy. This is because of the generally high income security in Norway in combination with extra support for furloughed workers. Moreover, the registered jobless rate has dropped, providing further support.
The second factor is the change in consumption behaviour. Norwegians are staying at home which suggests that the considerable share of border-shopping in Sweden goes to Norwegian stores instead.