Consumer Confidence and Poor Weather Impact March Retail Sales, Says Bloomberg PMI
New York (ots/PRNewswire)
- Bloomberg Eurozone Retail Survey Shows Sales and Profits Continue to Slide
The March Bloomberg Eurozone Retail Purchasing Managers' Index
("PMI(R)"), a monthly survey indicating economic conditions in the
Eurozone retail sector one month ahead of government figures,
indicates that month-on-month sales at Eurozone retailers continued
to fall during March.The Bloomberg Eurozone Retail PMI for March registered 48.5 and remained below the no-change mark of 50.0 for the third month in a row, signalling a further drop in retail sales across the Eurozone.
Retailers reported that customers remained cautious and were increasingly price sensitive, while poor weather conditions were again said to have had a negative impact on demand during the month, according to the Bloomberg survey.
Retail sectors in France (45.2) and Italy (46.8) were the primary sources of the overall decline in monthly retail sales in the Eurozone in March. France posted a more significant decrease in sales, with the sharpest decline in that country since survey data was first collected in January 2004.
Italian retail sales fell for the eighth successive month, though the rate of contraction eased compared with February's index numbers. Germany, meanwhile, registered growth in monthly retail sales for the fourth time in the past five months (52.4) as well as growth in like-for-like sales for the first time in four months (51.0).
Eurozone like-for-like sales decreased for the eleventh consecutive month from a year earlier (45.6), though the rate of contraction eased comparatively to February's index numbers. According to the Bloomberg survey, retailers reported that the latest fall in sales relative to the corresponding period of last year was due to poor consumer confidence, bad weather conditions and good March 2004 trading conditions.
The overall Eurozone decline in sales was in spite of the earlier Easter holiday, which typically provides a boost to retail sector activity during that month.
Sales Against Targets
Retailers in the Eurozone continued to miss targets in March (37.7). Moreover, the degree of failure increased for the second month running to the highest point since October 2004. Though according to panellists the weather was partly to blame, an unwillingness to buy among consumers was also reported to have undermined efforts to meet sales targets.
Original targets were not met in any three of the major Eurozone economies. However, retailers expected sales targets in April to increase with more favorable weather conditions (57.6). The greatest degree of confidence was expressed by French retailers (64.7).
Retailers' Stocks
Failure to meet sales targets and subdued demand led Eurozone retailers to cut purchasing activity again in March (47.1), with the exception of those in Germany. Purchasing in Germany rose for the first time since April 2004 (51.7). The overall drop in buying did not lead to a fall in overall stock of goods for resale, with inventories largely unchanged from a month earlier (50.1).
Margins and Prices
Eurozone retail sector profits fell again in March (43.6), as sales on a yearly and monthly basis continued to decline despite aggressive promotional activity designed to stimulate demand. The rate of decline in margins remained sharp despite easing slightly compared with February.
Profits were also affected by sharp increases in average purchasing prices (56.1). Input price inflation faced by Eurozone retailers in March was the highest as indicated by the survey since June 2004.
Employment
Cost pressures and declining sales led to a further fall in Eurozone retail sector employment in March (49.1). The rate of shedding employees was only marginal, however, as the majority of firms managed to avoid redundancies, instead releasing temporary staff or choosing not to replace those who left.
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Notes to editors
The Bloomberg Eurozone Retail PMI is the first monthly report of its kind in Europe, providing businesses, governments, central banks, economists and analysts the most accurate and up to date insights and data into the Eurozone retail sector.
The index, compiled exclusively for Bloomberg by NTC Research Ltd, questions more than 1,000 retail executives in Germany, France and Italy. These countries together represent approximately 75% of total Eurozone retail sales. National data are weighted together according to each country's contribution to total Eurozone retail sales to form the Bloomberg Eurozone Retail PMI.
The survey tracks changes in retail sales, performance against sales targets, inventories, prices, employment and other key indicators. Data are published approximately one month ahead of government figures.
The Bloomberg Retail PMI report is first published exclusively for Bloomberg users on the BLOOMBERG terminal at 09:00 GMT, followed by a general press release and analysis on Bloomberg Television. April and May data will be released on the following dates:
- April Data: Released 9 May 2005
- May Data: Released 6 June 2005Web site: http://www.bloomberg.com
Contact:
Loren Riegelhaupt of Sloane & Company, New York, NY,
+1-212-446-1871,lorenr@sloanepr.com, for Bloomberg