Charts of the Week
Charts of the week from 23 December 2024 to 3 January 2025: consumer prices, government bonds, real estate, turnover in trade and other charts
In December 2024, year-on-year growth in consumer prices (1.9%) was less than half the rate recorded at the end of 2023. The slightly higher year-on-year inflation compared to November was driven by a lower base effect, resulting from a drop in petroleum product prices at the end of 2023, and higher prices in the food and non-alcoholic beverages group. Amid a further decline in the volume of sales, year-on-year growth in dwelling prices remained relatively strong in the third quarter of 2024. Turnover in all trade sectors and most market services was higher in the first ten months of 2024 than in the same period of 2023. Following a deterioration in October, economic sentiment remained at a similarly low level until the end of 2024. However, compared to December 2023, the economic sentiment indicator rose slightly, though it still remained below the long-term average. Yields to maturity of euro area government bonds further decreased slightly in the fourth quarter of 2024.
Consumer prices, December 2024
Although prices fell month-on-month, annual inflation edged up slightly in December (to 1.9%), but it was less than half the rate recorded at the end of 2023 (4.2%). The increase in year-on-year inflation was primarily attributed to a lower base effect, driven by a decline in petroleum product prices at the end of 2023, with prices in the food and non-alcoholic beverages group rising again in December 2024 (by 0.5%). Year-on-year, prices in this category were 2.6% higher, contributing roughly a quarter to total year-on-year inflation and marking the highest contribution among the 12 groups of goods and services in the CPI basket. Energy prices rose by 0.5% in 2024. With a slightly more pronounced price drop in the clothing and footwear group, the year-on-year price increase for semi-durable goods slowed at the end of 2024 (to 2.0% from 3.0% in November). The year-on-year price decline for durable goods remained steady at around 1% throughout most of 2024. After declining during the year, the year-on-year growth in services prices in December (2.7%) was similar to that recorded in November. Higher prices in the restaurants and hotels group (up by 4.1%) accounted for roughly one-third of the overall growth.
Government bonds, Q4 2024
Yields to maturity of euro area government bonds further decreased slightly in the fourth quarter of 2024. This was still mainly due to the ECB’s monetary policy, which lowered its key interest rates twice in the fourth quarter – by a total of 50 basis points – as inflationary pressure eased. Quarter-on-quarter, the yield to maturity of the Slovenian government bond decreased by 9 basis points, reaching 2.98%. The spread to the German bond narrowed by 5 basis points, decreasing to 72 basis points.
Real estate, Q3 2024
Amid a further decline in the volume of sales, year-on-year growth in dwelling prices remained relatively strong in the third quarter of 2024. After price growth halved in 2023 (to 7.2% on average), prices increased by 7.9% compared to the third quarter of 2023 and by 1.7% compared to the second quarter of 2024. Prices of existing dwellings, where the number of transactions has declined significantly in the last two years (by 28.1% year-on-year and by 57.9% compared to the mid-2021 peak) were 8.4% higher year-on-year. Prices of newly built dwellings were 6.7% higher year-on-year. The number of transactions in this segment, which represents only a small part of total sales (5%), fell sharply year-on-year (by more than one third), after being relatively high in 2023 (almost 50% higher than in 2022 and at the highest level since 2018).
Turnover in trade, October–November 2024
In October 2024, real income continued to rise in some trade sectors while declining in others (seasonally adjusted); year-on-year, it increased across all sectors. Turnover in the sales of motor vehicles continued to rise following a decline in the first half of the year. Similarly, turnover in retail sales of food, beverages and tobacco increased further after stagnating during the first half of the year. In contrast, turnover in retail sales of non-food products decreased slightly. After strong growth in mid-summer, turnover also declined in wholesale trade for the third consecutive month. In the first ten months, turnover in all trade sectors was higher than in the same period of 2023. The highest real growth was recorded in the sales of motor vehicles (8%). It was 2% in wholesale trade and retail sales of food and beverages and 1% in retail sales of non-food products. According to preliminary data from SURS, turnover in retail sales of food rose month-on-month in November, turnover in retail sales of non-food products remained unchanged from the previous month and turnover in the sales of motor vehicles declined.
Turnover in market services, October 2024
Total real turnover in market services continued to decline in October 2024 (by 1.6%, seasonally adjusted), while it was higher year-on-year (by 1.6%). The decline was most pronounced in information and communication, which is attributable to lower sales in both main service groups (computer and telecommunications). Turnover also decreased again in professional and technical activities, this time mainly due to lower turnover in architectural and engineering services. It also decreased slightly in transportation and storage, albeit with an increase in land transport. Turnover in accommodation and food service activities increased significantly again as the number of overnight stays continued to rise. Turnover also increased in administrative and support service activities, breaking the negative trend in employment services, while the favourable trend in travel agencies continued for the third month in a row. In the first ten months of 2024, real turnover decreased year-on-year only in transportation and storage and professional and technical activities.
Economic sentiment, December 2024
Following a deterioration in October, economic sentiment remained at a similarly low level until the end of 2024. The economic climate indicator was slightly higher in December than a year earlier, but remains below its long-term average. Confidence was higher than a year earlier, particularly in trade and among consumers, both of which also improved slightly at the end of the year, as well as in services. Confidence in manufacturing remained at a low level in December, similar to December 2023. Confidence remained below the previous year’s level in construction, where after an upward trend, it deteriorated significantly towards the end of the year.