EUROZONE JUL RETAIL SALES +0.3% M/M (FCST +0.4% M/M); JUN -1.2% M/M

EUROZONE JUL RETAIL SALES -0.9% Y/Y (FCST -0.8%); JUN -3.7% Y/Y

• July Eurozone retail sales were softer than anticipated, seeing a minor +0.3% m/m improvement on June whilst contracting for the second consecutive month (albeit less severely) in the annualised print at -0.9% y/y (June saw -3.7% y/y).
• Non-food products accounted for the bulk of downwards pressure in July vs June, implying a slowdown in consumer spending as consumers grappled with inflation at 8.9% in July (9.1% in Aug).
• Retail sales volumes still remain above pre-pandemic levels. Euro area consumer confidence saw a small improvement from historic lows in August, however remains deeply pessimistic implying little improvement in spending.
• This morning the August services PMI was downgraded to 49.8 in the final print, which alongside a contractive manufacturing PMI suggests a contraction across the sector and a higher probability of a Q3 GDP contraction for the bloc.