GERMAN RETAIL sales unexpectedly fell for a third consecutive month in December, suggesting private consumption probably did little to offset one of the worst quarters in recent history for Europe’s largest economy.
Preliminary Federal Statistics Office data yesterday showed that adjusted for seasonal swings, retail sales fell by 0.2 per cent on the month in December, the third straight monthly drop. Year-on-year, sales fell 0.3 per cent in real terms.
The mid-range forecast of analysts polled last week was for Decembers retail sales to rise by 0.5 per cent month-on-month and by 0.7 per cent year-on-year.
Retail sales have been comparatively stable compared to traditional mainstays of the economy like exports and industrial output. The drop came as a disappointment.
“The hopes that business over Christmas would bring a genuine boost to all of Germany haven’t really been realised . . . but compared to many other countries, it’s not really that dramatic,” said Marco Bargel from Postbank.
“In any case the downturn in private consumption in Germany is not driving the recession – it’s not for example like exports or equipment investment,” Mr Bargel said.
Government sources said last month that the German economy probably contracted by between 1.5 per cent to 2.0 per cent on the quarter in the October-December period, following on from two previous quarters of negative growth.
That would be the economy’s worst quarterly showing since German reunification in 1990. –
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