Retail sales of goods in Poland decreased by 7.3 percent in March, according to data from Statistics Poland (GUS), marking the largest drop in consumption since the pandemic. This is due to high inflation and slower wage growth, which have limited purchasing power and forced savings.
In February, retail sales of goods decreased by 5 percent. GUS points out that the largest drop in consumption was observed in fuels, amounting to a decrease of 20.7 percent after a decline of 26.2 percent in February. Food sales decreased by 4.6 percent year-over-year in March.
There was also lower demand for furniture and audiovisual and household appliances. In March, their retail sales fell by 15.2 percent after a 10.3 percent decrease in February.
The reasons for the sales downturn include high inflation, which limits purchasing power and forces savings. The high reference base from a year ago had the most significant impact in March, as sales were boosted in 2022 by the mass influx of refugees from Ukraine and expenses incurred by Poles on their behalf.
According to ING Silesian Bank experts, sales were expected to decline further to a high reference base from March of last year when sales of pharmaceuticals, food, and clothing were boosted by refugees from Ukraine; the unfavorable broader economic context was also expected to be a factor.
The ING Silesian Bank economists had forecast that the decline in retail sales in March would amount to 6.2 percent year-over-year, less than the reported drop-off of 7.3 percent.
