Montenegro’s retail market recorded continued growth in the second quarter of 2026, with turnover increasing both before and after adjustment for inflation. Nominal retail turnover rose approximately 7.2% year on year, while real turnover increased 4.1%. Growth was recorded across several major retail categories. Turnover from motor fuel increased approximately 22%, while pharmaceutical and cosmetic retail rose 14.8%.
Other non-food retail categories recorded growth of around 7.1%, and food retail increased roughly 4.2%. The distribution of growth across the categories indicates that the increase in retail activity was not concentrated in a single category. Labour-market conditions also supported household spending during the period. Employment increased strongly in the first part of 2026, while average net wages remained above €1,000 per month.
Tourism contributed to retail demand as visitor spending feeds into consumption, particularly along the coast and in Podgorica. The seasonal impact of tourism can make it difficult to distinguish visitor expenditure from domestic household consumption. Household access to financing has also expanded. Bank lending is growing at double-digit rates, providing households with greater access to credit despite interest rates remaining materially above levels recorded several years earlier. The 4.1% increase in real retail turnover means sales growth exceeded the increase in general prices during the period.
Price developments could affect the pace of real consumption. Consumer inflation accelerated to 3.8% in July, with accommodation, alcohol and tobacco, food and transport among the categories contributing to monthly price increases. Continued price increases can reduce real household purchasing power even when nominal wages continue to rise. For retailers, employment, tourism activity and credit availability are supporting demand in 2026. Operating costs remain a key factor for business performance, with wages, rents and imported-goods costs potentially putting pressure on margins where competitive conditions limit the ability to pass higher costs through to consumers. Retail turnover is therefore increasing in real terms, while profitability is increasingly linked to the management of operating costs alongside sales growth.
