[BERLIN] German retail sales rebounded more strongly than expected in April, in a sign that private consumption will remain a growth driver for Europe's largest economy this year despite some weakness in the first quarter.
Retail sales, a notoriously volatile indicator that is often subject to large revisions, rose by 1.7 per cent on the month in real terms, data from the Federal Statistics Office showed, more than double the 0.8 per cent rate forecast by economists.
On a year-on-year basis, retail sales increased by 1.0 per cent as shoppers spent more on shoes, clothes, books, jewellery, pharmaceutical products and other items. "Consumption growth may slow a little with the oil price recovering a bit in recent months," said Christian Schulz of Berenberg. "However, the robust labour market, very low inflation and little incentive to save from very low interest rates should support continued household spending rises." In another positive sign, March's monthly retail sales data was revised up to a drop of 1.4 per cent from a previously reported plunge of 2.3 per cent.
Figures for the first four months of the year showed a solid 3.1 per cent increase in retail sales compared to the prior year.