Retail sales in Germany rose slightly during October, helping to offset the impact of slackening exports, but with unemployment expected to rise next year, the outlook for next year is cloudy.
Sales, including turnover at gas stations and cars, rose by 0.4 per cent from September, Bundesbank data showed today. A narrower measure excluding gas stations and auto sales had earlier shown a decline of 1.6 per cent on the month.
Economists said falling oil prices had probably helped to encourage spending on fuel, boosting the October result.
Compared with the previous year, total sales were down by 1.7 per cent in October, which in 2008 had the same number of shopping days as the same month a year earlier.
With employment at a record high in Europe's biggest economy, inflation easing and the savings rate at a 14-year high, analysts say German consumers are well positioned to help the country as it battles recession.
The GfK market research firm's latest survey of consumer sentiment suggested the mood would improve going into December.
The economic slowdown has been led by a deterioration in foreign demand, hitting Germany's exports.
Figures from the VDMA plant and equipment makers' association published today showed foreign engineering orders fell by 19 per cent on the year in October.
The immediate outlook for retail spending is mixed.
A survey of retail purchasing managers in November showed German retail sales were even weaker last month, though the country's HDE industry association said Christmas sales in Europe's largest economy had started briskly.
"Business on the first advent weekend went really well," HDE spokesman Hubertus Pellengahr said last night. "Most retailers are happy. That applies to all of last week too."
Reuters