While the emergency situation and its restrictions impacted negatively in Estonia in the entertainment, food services, health care and travel sectors, a gradual recovery in consumption has been observed since the second half of April, SEB said on Tuesday.
The final week of the emergency situation, which ended on May 17, showed a fundamental change in the consumption habits formed during the quarantine period, which has resulted in a significant increase for some areas of commerce.
The sales of furniture, interior goods and gardening retail grew by almost 60 percent at the end of the emergency situation, home electronics - used for working from home - increased by 15 percent, and grocery stores saw a 20 percent increase in sales.
At the same time, there were periods during the emergency situation when all areas of commerce were negatively effected. In addition, consumption during the emergency situation is characterized by volatility, which was affected by both the news flow as well as the number of COVID-19 positive diagnoses, SEB said.
Lennart Kitt, head of client analysis and data science for the Baltic states at SEB, said in a press release that starting from the 12th week of the year, which started on March 16, a standstill in consumption is evident.
"While some fields, such as transport, tourism and entertainment had already started to come to a halt when the epidemic was spreading, the declaring of the emergency situation caused a sudden fall, which arrived at once after the wave of panic buying in the 11th week," Kitt said.
Judging by consumption statistics, Estonian consumers felt very insecure during the first week of the emergency situation. Consumption shyness peaked at the time when also the number of patients needing treatment in hospital reached its peak, which happened around April 12, one month after the start of the emergency situation. It was only starting from the second half of April that residents again displayed readiness for major purchases also in areas beyond everyday spending.
"However, looking at the past couple of weeks, we can see a significant rise in optimism at the end of the emergency situation, which hopefully will become a solid trend," Kitt said.
He added that also the sales of garment stores, which saw a fall of 60 percent due to the closure of shopping malls, have returned almost to the usual level when malls reopened. A recovery can be seen also in the sales of cafes and eateries, albeit at a slightly slower pace, he said.
The analysis of consumer behavior is based on bankcard transactions by SEB clients and it covers the period from the 8th to the 20th week of 2020.
Estonia's retail confidence indicator improves in May
The value of the retail confidence index calculated by the Estonian Institute of Economic Research increased from -36 points in April to -23 points in May, while the indicator stood at 27 points in May 2019.
The indicator, reflecting sales in the past three months, fell by 3 points month on month to -25 points in May, while in May 2019 the value of the index was 41 points.
The assessment concerning inventories declined by 7 points month over month to 28 points in May, the indicator stood at 10 points in May 2019.
The retail sector's forecast when it comes to sales in the next three months moved up from -50 points to -17 points in May, while the indicator stood at 51 points in March 2019.
The service sector confidence index moved down from -48 points in April to -58 points in May. The value of the indicator was 18 points in March 2019.
Editor: Helen Wright