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On Thursday morning, Statistics Norway (SSB) presented retail sales figures, excluding motor vehicle sales, from November to December. A 1.4 percent drop was expected in advance, according to estimates obtained from five brokerages by TDN Direkt.
The result was a decrease of 5.7 percent.
Oslo is practically empty after most shops and restaurants must close under new crown rules. On Thursday, Statistics Norway will present retail sales figures for December. (Photo: Skjalg Bøhmer Violence)
– A drop of almost six percent is clearly stronger than expected. It’s probably a big surprise to many, says senior economist Marius Gonsholt Hov at Handelsbanken Capital Markets.
He had previously expected growth of 0.5 percent in December and notes that card statistics pointed to little change from November.
In November, retail sales rose 2.9 percent and were particularly affected by electronics and online shopping after Black Friday, as well as a shift in holiday shopping from December to November. Due to strong growth in November, as well as the distortion of the Christmas trade, analysts expected a decline in December.
Extremely large rash
Hov points out that last year the all-time Christmas trade was predicted. Despite the strong increase in retail sales in November, November and December as a whole will be weaker than expected.
– We have seen extremely large results in retail sales in 2020. This has been out of the box. There also appears to be a general decline. In general, November and December were not what one had imagined, says the economist.
According to Statistics Norway, most retail industries experienced a decrease in turnover from November to December. Electronics was the biggest contributor to the drop, but furniture and grocery retailing also contributed to the drop. One of the few industries that raised the index was clothing retail.
Compared to December 2019, the retail sales index was eight percent higher. Therefore, the level is higher than before the pandemic broke out.
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Less activity
Hov notes that service consumption was probably not strong in December either. When retail sales do not compensate for the increase, this means that total private consumption is weak.
– It illustrates that we are in a period where there is less activity in the economy, and that there is downside risk, he says.
The economist notes that the restrictions after the New Year have tightened and that most stores in the capital region must now remain closed.
– The outlook here and now is not good for the economy. The beginning of the first trimester is weak, says Hov.
At the same time, he is still optimistic about future prospects and expects activity in the economy to pick up as the launch of the vaccine goes according to plan.
Difficult start of the year
The leading Virke organization for the commerce and services industry believes that the retail turnover figures show that December was another difficult month for clothing, shoes and cosmetics.
– These are record numbers that we will not see again in a normal situation. In difficult times for much of the Norwegian economy, trade has been important for employment. At the same time, the numbers show how the crown affects trade, and those who had a tough 2020 have had an even tougher start to the year, says trade director Harald Jachwitz Andersen at Virke.
Andersen believes that the situation has changed radically since December and that the new restrictions create greater challenges for the commercial industry.
Statistics Norway’s Retail Sales Index shows that e-commerce increased by almost 45 percent in December 2020, compared to December of the previous year.
– Although e-commerce is the growth winner in 2020, brick-and-mortar stores make up by far the majority of commerce. That’s why closed stores are suffering a lot during the crown close we’re in now, Andersen says. (Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We would like you to share our cases via a link, which leads directly to our pages. Copying or other use of all or part of the content may only be done with written permission or as permitted by law. For more terms, see here.
