Retail performance varies across the region

The complete set of February's retail sales data was finalized yesterday. The performance of the sector has shown increased variability across the CEE region during the second month of the year. In Czechia and Hungary, we saw a solid growth in retail sales, being on par with the previous year's average. Retail sales also experienced real-term growth in Romania and Croatia, although a deceleration compared to 2024 is evident. On the other hand, slight contractions were reported in Poland and Serbia. In Poland, the retail sector's performance was especially disappointing, with real growth falling short of the anticipated 3% y/y increase. Slovakia reported a more significant, albeit expected, decline. The 2.6% y/y drop is the first after thirteen consecutive months of growth. This decline is primarily attributed to deteriorating consumer sentiment and the impact of early purchases made in December, as households anticipated price increases driven mainly by higher VAT.