SEB: July consumer spend nearly at levels of previous year

SEB logo.
SEB logo. Source: Priit Mürk/ERR

Consumer spending has returned to the levels it was a year ago, at least with bank card payments, according to SEB bank, fueled in part by a rise in spending on entertainment and tourism after a hiatus during the peak of the COVID-19 pandemic.

However, this does not necessarily mean a return to business as usual as it was in July 2019 for many firms, particularly those who depend on foreign tourism.

SEB spokesperson Lennart Kitt said that while the recovery consumer spending in Estonia is definitely a positive sign, it is equally certain that based on this data alone it is too soon to talk about full recovery in the economy. 

While in April this year, consumers in Estonia spent almost 90 percent less on travel than in April 2019, in July this year, spending in the sector had recovered to the extent that it was 40 percent lower than a year before, SEB says. 

Spending on entertainment stood at 17 percent lower in July 2020 than the same month last year, and spending in cafes and restaurants had actually risen slightly, by 1 percent. 

On the eve of the pandemic, there had actually been strong growth in the same sectors. 

"In the field of entertainment, spending by residents grew by 24 percent February [2020] versus February [2019], and the rate of growth in the catering sector for the same period was 17 percent," he  said.  

This was followed by a drop of almost a third to March – the month the government declared an emergency situation in response to the pandemic - and fell by 65 percent between February and April. 

Spending on less necessary products and services, including design, home refurbishment and  interiors rose on year, though slowed down June to July. 

In June this expenditure was 20 percent up on year, but by July the rate of growth had fallen to 10 percent on year, SEB says. 

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Editor: Andrew Whyte

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