Sweden’s December year-on-year retail sales weakest since October 2012

Sweden’s retail trade weakens significantly in December. On a year-on-year basis, Swedish retail sales rose 0.6 percent, a sharp slowdown from November’s year-on-year 3.8 percent growth. Consensus expectations were for retail trade to grow 3.5 percent. November’s figure was upwardly revised from 3.6 percent. The December figure was the weakest year-on-year figure since October 2012.

On a sequential basis, Swedish retail sales dropped 2.9 percent in December, as compared with the 1.7 percent sequential rise in November and consensus expectations of a decline of 0.2 percent. November’s figure was upwardly revised from 0.9 percent. A new seasonal pattern, with the Black Friday sales gaining importance, possibly explains some of the sharp decline in December’s retail sales, noted Nordea Bank in a research report.

The upward revised and very strong reading for November underpins the view that there is a new seasonal pattern. Furthermore, the subdued sales figures for December are in contrast to the rebounded consumer sentiment witnessed in recent months.  Indeed, retailers are slightly downbeat, showed NIER’s Tendency Survey. However, the sales situation for January is better than the subdued December sales reading. This implies that there is a temporary blip and that sales are expected to recover in January.

Meanwhile, figures elsewhere indicated that household credit growth in December stayed unchanged from November at 7.2 percent year-on-year. Moreover, in seasonally adjusted terms, credit growth stayed nearly unchanged around SEK 19 billion.