German retail sales fall unexpectedly in January

[BERLIN] German retail sales fell unexpectedly in January, data showed on Friday.

The volatile indicator, which is often subject to revision, showed retail sales fell by 0.8 per cent on the month in real terms, the Federal Statistics Office said.

This followed a revised December figure for unchanged sales from an initial drop of 0.9 per cent. The January figure came in sharp contrast to a Reuters consensus forecast for a 0.2 per cent rise.

On the year, retail sales edged up by 2.3 per cent in real terms, the data showed.

A breakdown of the year-on-year data showed that sales in all branches had risen in January, except for textiles, clothing, and shoes as well as sales at department stores.

The data came after a survey by the GfK research group last week showed the mood among German consumers had worsened more than expected heading into March to reach its lowest level in four months.

Record-high employment, increased job security, rising real wages and ultra-low borrowing costs have boosted the spending power of Germans, turning consumption into the main driver of growth in a traditionally export-driven economy.

REUTERS