PUBLISHED February 28, 2026
According to “Verbesserung der Stimmung im Einzelhandel zu Jahresbeginn, Weihnachtsgeschäft verlief positiv” published by WIFO, Austria’s retail sector entered 2026 with noticeably improved sentiment following a better-than-expected Christmas trading period.
Holiday Season Brings Stabilisation
The Austrian Institute of Economic Research reports that after a noticeable decline in November, real retail sales stabilised in December based on preliminary data, indicating that the sector managed to regain some footing toward year-end. The improvement was not uniform across all segments, however. WIFO economist Jürgen Bierbaumer noted that food retail gained momentum, while non-food retail sales remained subdued, pointing to an uneven recovery pattern within the sector.
Consumer Demand Slowly Returns
From a macroeconomic perspective, the broader environment remains moderate. WIFO’s rapid estimate shows that Austria’s economic output grew by 0.2% quarter-on-quarter in real terms in the fourth quarter of 2025, supported in part by private household consumption. This suggests that consumer demand is slowly returning, providing a fragile but important tailwind for retailers.
Inflation developments are also contributing to the improved outlook. According to Statistik Austria’s flash estimate cited by WIFO, inflation fell sharply to 2.0% in January 2026 from 3.8% in December, largely due to declining energy costs and the fading impact of earlier electricity price support measures. Lower price pressure is expected to gradually ease the burden on household purchasing power, a key variable for retail performance.
Inflation developments are also contributing to the improved outlook. According to Statistik Austria’s flash estimate cited by WIFO, inflation fell sharply to 2.0% in January 2026 from 3.8% in December, largely due to declining energy costs and the fading impact of earlier electricity price support measures. Lower price pressure is expected to gradually ease the burden on household purchasing power, a key variable for retail performance.
In terms of actual turnover, the December figures were mixed but broadly stable. Calendar-adjusted data show that nominal retail sales excluding motor vehicles rose 1.9% year-on-year in December, while in real terms they edged down slightly. Nevertheless, WIFO notes that the Christmas-related additional sales likely exceeded the 2024 level, confirming that the holiday season delivered a modest boost to the sector.
Looking at the full-year picture, Austrian retail generated €79.5 billion in net turnover in 2025, representing nominal growth of 2.9% and real growth of 0.7% compared with 2024. While these figures do not signal a boom, they do point to gradual stabilisation after a challenging period.
Perhaps the most notable shift is in sentiment. WIFO reports that retailers’ confidence improved significantly at the turn of the year, particularly regarding expectations for the coming months, which are described as more optimistic than they have been for some time. Assessments of the current business situation have also become more positive, indicating that the sector may be moving past its weakest phase.
For sales strategists and consumer-facing businesses, the message is cautiously encouraging. Austria’s retail market is not yet in a strong expansion phase, but the combination of easing inflation, stabilising consumption and improving business sentiment suggests that conditions are gradually turning more supportive.
Bottom line: Austria’s retail sector is entering 2026 with renewed confidence following a solid Christmas season. While growth remains moderate and uneven across segments, the improving mood among retailers signals that the market may be slowly transitioning from stabilisation toward recovery.
Looking ahead, the Austrian retail sector appears set for a cautious but improving trajectory. With inflation easing and household consumption slowly strengthening, the fundamental conditions for retail activity are becoming more supportive. However, the recovery is expected to remain uneven, particularly between food and non-food segments, and overall growth is likely to stay moderate in the near term.
For sales leaders and consumer-focused businesses, this means 2026 will likely reward targeted positioning rather than broad-based expansion. Companies that closely track shifts in purchasing power and adapt to changing demand patterns will be best placed to benefit as Austria’s retail market continues its gradual path toward recovery.
In terms of actual turnover, the December figures were mixed but broadly stable. Calendar-adjusted data show that nominal retail sales excluding motor vehicles rose 1.9% year-on-year in December, while in real terms they edged down slightly. Nevertheless, WIFO notes that the Christmas-related additional sales likely exceeded the 2024 level, confirming that the holiday season delivered a modest boost to the sector.
Looking at the full-year picture, Austrian retail generated €79.5 billion in net turnover in 2025, representing nominal growth of 2.9% and real growth of 0.7% compared with 2024. While these figures do not signal a boom, they do point to gradual stabilisation after a challenging period.
Perhaps the most notable shift is in sentiment. WIFO reports that retailers’ confidence improved significantly at the turn of the year, particularly regarding expectations for the coming months, which are described as more optimistic than they have been for some time. Assessments of the current business situation have also become more positive, indicating that the sector may be moving past its weakest phase.
For sales strategists and consumer-facing businesses, the message is cautiously encouraging. Austria’s retail market is not yet in a strong expansion phase, but the combination of easing inflation, stabilising consumption and improving business sentiment suggests that conditions are gradually turning more supportive.
Bottom line: Austria’s retail sector is entering 2026 with renewed confidence following a solid Christmas season. While growth remains moderate and uneven across segments, the improving mood among retailers signals that the market may be slowly transitioning from stabilisation toward recovery.
Looking ahead, the Austrian retail sector appears set for a cautious but improving trajectory. With inflation easing and household consumption slowly strengthening, the fundamental conditions for retail activity are becoming more supportive. However, the recovery is expected to remain uneven, particularly between food and non-food segments, and overall growth is likely to stay moderate in the near term.
For sales leaders and consumer-focused businesses, this means 2026 will likely reward targeted positioning rather than broad-based expansion. Companies that closely track shifts in purchasing power and adapt to changing demand patterns will be best placed to benefit as Austria’s retail market continues its gradual path toward recovery.
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