Following the eight-year record high registered in February, retail sales were record-breaking again, gaining 8.5 percent in March. This figure is indicating steady and continuous improvement of domestic consumption. The latest data has been the result of lower utility costs, family tax allowance, record-high increase in employment, higher wages in real terms and improving consumer sentiment. As cash machines have recently been connected on-line to the tax authority, it also created more transparency in the economy and thus this measure also contributed to growth.

In March 2014, the volume of sales at the national retail network as well as at mail order service providers totalled HUF 701bn, up by HUF 42bn year-on-year. The sales volume of food, beverages and tobacco products increased by 8.1 percent, but the increase in the non-food segment was even larger, soaring 8.5 percent in March compared to the corresponding period of 2013. Sales at filling stations were 9.5 percent higher.

The fact that along with the outstanding jump recorded in March retail sector growth exceeded 6 percent in January and February and household consumption showed quarter-on-quarter increases last year is a sign of continuing domestic consumption growth.

The Government has over the past years aimed to leave as much money at households as possible. Thanks to consumption growth, the Hungarian economy has entered a growth path which besides exports is also increasingly supported by domestic demand. In the coming months, the Government is expecting further expansion in the retail sector.

(Ministry for National Economy)