Eurozone: Consumption is slowing – ABN AMRO

Aline Schuiling, senior economist at ABN AMRO, points out that the volume of retail sales in the Eurozone increased by 1.0% MoM in November, following a 0.3% MoM decline in October (revised up from -0.6%).

Key Quotes

“It seems that private consumption slowed down in Q4 after it expanded by 0.5% qoq in Q3. Importantly, the 3month-over-3month growth rate in retail sales declined to 0.2% in November, down from 0.5% in October. Considering that the series is very volatile, it is likely that the rise in November will be followed by some payback in December, which suggests that retail sales were weaker in Q4 than in Q3, when they rose by 0.5% qoq. On top of that, car sales seem to also have slowed down in Q4.”

“The 3month-over-3month growth rate in new passenger car registrations dropped to -8.0% in November, down from -0.6% in October. Even if registrations were to grow robustly in December, they would still have contracted slightly during Q4 as a whole. Combined with the fact that consumer sentiment has edged somewhat lower in Q4 and the unemployment rate has stopped falling, it seems that private consumption growth slowed down.”