Norwegian retail sales volume fall in August, strong recovery likely in 2021
Norwegian retail sales volumes dropped 4.9 percent on a month-on-month basis in August, following a rise of 0.6 percent recorded in the prior month. The fall was a correction from very high sales levels early in the summer and the level is still high compared to the beginning of the year.
In April, retail sales jumped and rose further in the following months. The average sales level in the period May to July was 11.7 percent above the average from the second half in 2019. Therefore, a downward adjustment was likely to take place sometime this autumn. The sales in August were 7.8 percent above the level in February. There is still a way to go before sales are normalized, noted DNB Markets in a research report. Nevertheless, purchases abroad have shifted to domestic purchases. This might add to a higher normal level of retail sales. Norges Bank expects private consumption to drop 7.5 percent this year and rise 7.7 percent in 2021.
“Today’s figures may indicate a deeper fall this year and a stronger recovery next year. But these figure lead to any new signals from Norges Bank”, added DNB Markets.