Retail Sales YoY

What is Retail Sales YoY?

Retail Sales YoY is the year on year change in euro area retail trade volume. It tracks an index of deflated shop turnover. Deflated means price changes are removed, so it tracks quantity of goods sold, not money earned. It covers NACE Division G47, the code for shop retail excluding motor vehicles, and excludes wholesale and retail services. Eurostat, the statistical office of the European Union, publishes it monthly as a key policy gauge. The index equals 100 at the base average, so above 100 means volume above that average. There is no target band and no expansion line, so reading is directional through growth rates. The monthly rate uses fully adjusted data, while the yearly rate uses calendar adjusted data only.

When is it released and what happens each release?

The reference period is the calendar month, covering totals invoiced during that month excluding VAT. Countries send retail data 1 month after the reference month. Eurostat publishes a news release on its website at 11:00 CET, free of charge, on preannounced dates. Publication lands about 30 to 38 days after month end. Each release carries euro area and European Union totals, Member State figures, product breakdowns, growth rates and weights. Each release revises earlier months as new national data arrive, and seasonal adjustment is re-estimated. Missing country data are estimated and flagged in the database.

What moves Retail Sales YoY?

Headline Retail Sales YoY is a weighted aggregate of shop retail groups that react differently to cycles.

• Food, beverages and tobacco: defensive staples that cushion the headline in downturns.
• Non-food products except automotive fuel: cyclical core including clothing, electrical goods, furniture, books and pharmacy items.
• Automotive fuel in specialised stores: fuel station sales that swing with mobility.
• Mail orders and internet: structural grower that can rise even when stores slump.

A lockdown shock showed how components split around the headline. Total volume fell 11.7% on the month and 19.6% on the year. Fuel sales fell 27.7% on the month, and non-food fell 17.0% on the month. Clothing and footwear fell 20.9% on the month after a 54.7% fall in the prior period. Food fell 5.5% on the month yet rose 2.5% on the year, while mail and internet orders grew 10.9% on the month. Only Finland grew, by 0.3% on the month, while France fell 31.1% on the year and Spain fell 29.8% on the year. The prior month was revised from 11.2% to 11.1%. The following release recorded a 17.8% monthly rebound, showing how this series spikes and reverses around shocks.

How is Retail Sales YoY calculated?

1. Nominal turnover: everything retail units invoiced in the month, including packaging and transport but excluding VAT.
2. Deflation to volume: divide turnover by the national price indicator to remove price changes. For example, turnover 130.0 over prices 125.0 gives volume 104.0.
3. Indexing: express volume against the base average, so that average equals 100.
4. Calendar adjustment: remove calendar effects such as leap effects, holidays and day mix to give a calendar adjusted index.
5. Aggregation: combine national and product indices using fixed base turnover weights. Gaps are filled only under the 60% and 80% coverage rules.
6. Seasonal adjustment: build the euro area adjusted index as a weighted average of national adjusted series, not by adjusting the total directly.
7. Growth rates: the monthly rate compares consecutive months on fully adjusted data. The yearly rate compares with the same month of the previous year on calendar adjusted data only. For example, 103.5 against 100.0 gives +3.5%, and 103.5 against 103.0 gives +0.5%.

Key point: a rising index does not mean retailers earned more, because price changes are removed. Read the yearly rate off calendar adjusted data, not the seasonally adjusted series. It covers shop retail only, not cars, wholesale or services.