Retail Boom In January

• The sales boom, especially for non-edibles, is purely circumstantial, the main cause being The National Bank's decision to tighten credit eligibility criteria as of February

Retailers will remember January 2004 as the month of a 21.3 percent year-on-year turnover increase. The National Statistics Institute (INS) has officially confirmed this boom. INS data indicate a 26.5 percent increase in sales of non-edibles and a 15 percent increase in sales of edibles. This growth is particularly significant considering that the retail industry only gained 5.7 percent on the edibles segment and 8.9 percent on the non-edibles segment throughout 2003. "The non-edibles sales boom was partly due to the fact that The National Bank had announced late last year that it was going to tighten consumer credit eligibility criteria. The announcement prompted consumers to rush to buy durables," said Dan Ostahie, president of Altex, one of the largest retailers of electronics and home appliances. "Our sales grew by 30 percent in January, reaching 15 million EUR," Ostahie added. "However, February was not such a good month, as sales even decreased against February 2003. Things got better in March and I believe they are back to normal now," he told "Bursa". "The National Bank's announcement generated some abnormalities as sales made in December-January looked like sales specific of February-March," he explained. Ostahie estimates that the home appliance market will grow by some 10-to-15 percent this year. "The National Bank's norms designed to hamper consumer credit are the most plausible explanation for January's retail boom," "Bursa" was told by Daniel Daianu, economy professor and former chief-economist of The National Bank. "However, January's retail boom did not have much of an impact on the foreign deficit or the inflation rate, as indicators show so far," Daianu added. The trade deficit (FOB/ CIF) gained 50 percent in January, reach-ing nearly 320 million EUR. The total January-February deficit was 593 million EUR, up by one third year-on-year.

Companies specializing in the sale, maintenance and repairing of cars and motorcycles, as well as fuel retailers saw a 4.2 percent turnover growth in January. Fuel sales increased by some 7.3 percent during that month. In the same interval, companies rendering various services to individuals achieved a 28 percent turnover increase.