(Bloomberg) -- Czech retail sales picked up pace in June, underscoring private consumption as the main driver of otherwise tepid economic growth and a key focus for the central bank in calibrating monetary-policy easing.
Sales excluding cars rose 4.4% from a year earlier, data from the statistics office showed Monday, up from a revised 3% in the previous month and exceeding the 4.1% median estimate in a Bloomberg survey.
“Sharp increase in real wages, higher consumer confidence and a gradual spending of households’ elevated savings are creating conditions for a recovery in consumer demand,” said Dominik Rusinko, an analyst at CSOB AS in Prague. “That will be driving the Czech economy also in the second half of the year.”
The data came shortly after the Czech National Bank slowed monetary-policy easing as persistent inflation risks in services overshadowed concerns about weak demand abroad and a sluggish recovery in the export-led economy. Policymakers lowered interest rates by a quarter of a percentage point on Thursday, after four consecutive half-point cuts.
Households “are still somewhat cautious” in spending and the improving retail sales shouldn’t cause too much concerns for the central bank, according to Petr Dufek, chief economist for Banka Creditas in Prague.
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