According to Eurostat, Croatia recorded the sharpest decline (-2.7%) in the volume of retail trade in the European Union in June 2024 compared to the previous month. Compared to May 2024, the seasonally adjusted volume of retail trade fell by 0.3% in the euro area and by 0.1% in the EU.

“Among the Member States for which data are available, Croatia (-2.7%), Austria (-2.3%), Latvia and Lithuania (both -1.7%) recorded the largest monthly decreases in total retail trade volume. The highest increases were observed in Romania (+1.8%), Bulgaria (+1.4%) and Denmark (+1.0%)”,” according to initial estimates from Eurostat, the statistical office of the European Union.

In May 2024, the volume of retail trade grew by 0.1% in both the eurozone and the EU.

In the euro area, the volume of retail trade of food, drinks and tobacco decreased by 0.7% in June 2024 compared to May 2024.

Romania, Luxembourg and Croatia with largest year-on-year increase

Sales of non-food products (except fuels) also fell in the eurozone, by 0.1, while sales of fuels in specialised shops rose by 0.5%.

In June 2024, the calendar-adjusted retail sales index fell by 0.3% in the euro area and rose by 0.1% in the EU compared to June 2023

Among the Member States for which data are available, Romania (+10.2%), Luxembourg (+7.9%) and Croatia (+5.4%) recorded the strongest annual increase in total retail trade volume. The largest decreases were observed in Belgium (-7.3%), Estonia (-4.1%) and Austria (-3.9%).

Salary increases are not reflected in consumption

The Croatian Employers’ Association says that such a decline in industrial production has not been recorded in Croatia since the pandemic lockdown. This is the seventh month in a row with a decline in industry, with the decline in June being sharper than in the previous month, when it was 3.3 per cent.

The Croatian Employers’ Association therefore concludes that the latest macroeconomic data on consumption and industrial production point to a slowdown in the growth of the Croatian economy.

The real slowdown in consumption in the second quarter shows that the significant increase in wages and incomes in 2024 is not translating into consumption and people are becoming increasingly cautious with their spending.

The Croatian Employers’ Association assumes that this trend of slowing consumption will continue until the end of the current year and adds that the decline in industrial production will affect exports of goods and overall GDP.