Forecasts of May retail sales were fairly consistent and as a whole didn't miss the mark - retail sales in the previous month slowed from 7.6% yoy in April to 4.4% yoy. Of course, this does not mean that there are no topics worth commenting on in these data. There are two.

Firstly, the March-April period was marked by significant fluctuations in food sales growth (from -9.4 to +9.7% yoy) caused by the shifts in the Easter holiday dates. May is already free from these effects, and food sales increased by 1.5% yoy, which is surprisingly good, but within the recent range (we expected it to return to annual declines, though).

Retail sales of food (% yoy)

Source: GUS, Macrobond, Pekao Research

Secondly, sales of durable and semi-durable goods look good. The surprises relative to our assumptions (furniture and household appliances, clothing and footwear - negative; pharmaceuticals and cosmetics, press and books, cars - positive) essentially canceled each other out. Noteworthy is that the sales of furniture and household appliances grew in May at the fastest rate since April 2022 (+18.7% y/y), and excluding months shaped by the low COVID-related base, since mid-2019. Among all categories of retail sales, this was also the fastest-growing one, and again, if we want to find a similar situation in the data, we have to go back to 2019.

Retail sales of furniture and RTV and AGD equipment (% yoy)

Source: GUS, Macrobond, Pekao Research

On paper, the aforementioned list looks very good, but it is worth remembering that durable goods sales have just emerged from a multi-year downturn - they peaked in spring 2021 and had fallen by about 25% between than and the end of 2024. The potential to catch up is therefore gigantic, provided that macroeconomic conditions allow it.

After excluding seasonal and calendar factors, sales fell by 2% mom, which should not be surprising, given the high point marked by April sales. This does not change the fact that the recovery observed since spring 2023 is real. This leads us to a more general question - is private consumption the dark horse of this year? So far, retail sales this year have increased by 3.2% yoy, which is identical to the average sales growth in 2024 (3.3%). The following months have a chance to improve the result for 2025, and we would expect an average annual sales growth of about 4%. However, the differences are not large, and a slight change in consumption patterns could explain this without resorting to a significant acceleration of consumption compared to the previous year. We still expect private consumption to grow by about 3% this year, similar to 2024. The difference is in the relationship between consumption growth and current income - the period of extraordinary savings is over.

Retail sales and private consumption (% yoy)

Source: GUS, Macrobond, Pekao Research

With retail sales data for May, we now have a large portion of hard and soft data for Q2. Based on them, we can estimate that GDP growth accelerated to about 3.5% yoy.