Euro zone retail sales fell further than expected in May, data showed today, dampening hopes that an improvement in consumer spending might ease the recession.
Retail sales in the 16-country currency area fell 0.4 per cent month-on-month, the European Union statistics office said, worse than the 0.1 per cent drop expected by economists in a Reuters poll.
Sales fell 3.3 per cent year-on-year, while analysts had expected a 2.7 per cent decrease.
The data, which came a day after the European Central Bank kept euro zone interest rates steady at 1 percent, showed consumer demand continued to suffer from the worst recession since World War Two.
Eurostat revised down its retail trade figures for April to a rise of 0.1 per cent month-on-month and a fall of 2.5 per cent annually from the previous readings of plus 0.2 per cent and minus 2.3 per cent, further illustrating recent cautious outlooks given by some of Europe's top retailers.
Euro zone retail sales had inched up month-on-month for the first time in five months in April and their annual decline was lower than expected.
Most large European retailers, such as Carrefour, Tesco and Marks and Spencer, have been reporting signs that consumer confidence is stabilising, but there has been little indication that spending is picking up.
Sales of non-food products in the euro zone in May dropped 0.6 per cent month-on-month and 3.4 per cent year-on-year despite good weather, which normally boosts consumer spending.
Eurostat said food, drink and tobacco sales increased 0.2 per cent on the month, but fell 1.7 per cent from a year earlier.
Retail sales are an indication of household demand, under pressure from rising unemployment due to factory closures and lay-offs. Joblessness in the euro zone rose in May to 9.5 per cent, its highest in 10 years.
Reuters