Retail trade turnover increased in April, rising 8.3% at current prices and 5.6% at constant prices year on year. In the first four months, turnover grew 9% nominally and 7.9% in real terms. Real growth was recorded across fuel retailing, food and non-food product categories.
Wages remain a key support for household demand. The average net wage reached RSD121,650 in March. In the first quarter, average net wages rose 11.7% nominally and 8.9% in real terms versus a year earlier. The median net wage stood at RSD92,753.
Tourism trends support hospitality while overnight stays diverge
Tourism indicators also point to ongoing demand for accommodation services. Tourist arrivals increased 8.6% year on year in April. Overnight stays rose 3.8% overall, with domestic overnight stays up 8.2%. Foreign overnight stays declined by 0.2%.
The base-case outlook is that retail activity stays positive in the second half of 2026, although real growth is expected to slow from the January-April pace to low-to-mid single digits. Domestic tourism is forecast to outperform foreign tourism during the period. Hospitality revenues are expected to keep growing, but margins are projected to tighten.
Inflation mix raises margin risk for retailers and hotels
Consumer prices rose 3.5% year on year in May and were up 0.3% from April. Transport prices increased by 1% month on month. Other categories that recorded increases included housing and utilities, restaurants and accommodation, health, clothing and personal-care.
Businesses face margin pressure when cost increases outpace pricing adjustments across categories. A restaurant may see higher guest numbers but still earn less if wages, rent, utilities and food inputs rise faster than menu prices. Retailers can register higher turnover while losing margin if transport and inventory costs climb.
Hotels can also experience revenue gains alongside cost headwinds tied to labour and energy. The second half is therefore expected to be more selective for consumer-facing operators as operating costs become less forgiving relative to demand signals.
Which segments are most exposed as competition intensifies
The most exposed companies are described as mid-market operators with limited pricing power . Discount retailers and value grocers are positioned to attract price-sensitive consumers . Premium restaurants and hotels can sell experiences to higher-income customers, while the middle segment faces difficulty due to affordability constraints for bargain shoppers and weaker differentiation for premium buyers.
Domestic tourism is expected to remain among the stronger areas based on April data showing continued household willingness to spend on local travel . Spas, mountain resorts, weekend destinations and regional leisure operators are set to benefit, particularly where packages are tailored to domestic visitors rather than relying heavily on foreign arrivals.
Food retail is expected to stay defensive amid intense competition . Grocery chains with private labels, loyalty programmes and efficient logistics are described as better placed than smaller stores with weaker purchasing power . Fuel-efficient delivery models are also expected to matter more if transport costs remain volatile.
Hospitality operations are expected to focus on pricing and productivity in the second half . Operators are expected to manage menus, staffing levels, energy consumption and supplier terms more actively . Those able to raise prices selectively while protecting traffic should outperform, while operators relying primarily on higher footfall may face a harder margin squeeze.
The overall consumer picture remains supported by wage growth translating into spending power and by resilient retail volumes . Domestic tourism demand is described as continuing, but the cost base is expected to weigh more heavily on profitability than earlier in the year .
