• Germany's news in English

German retail sales post surprise fall in March

AFP · 2 May 2008, 14:26

Published: 02 May 2008 14:26 GMT+02:00

Facebook Twitter Google+ reddit

Retail sales in March fell a real or inflation-adjusted 0.1 percent from February and slumped 6.3 percent compared with a year earlier, the statistics office said on Friday.

Economists were caught on the hop. They had expected a 0.5 percent rise in sales from February and a 1.3 percent increase over March last year.

A statement warned against excessive pessimism, saying the fall was due to a number of special factors including an early Easter holiday period meaning less shopping days, and a record performance in the year-earlier period.

Statistics agency Destatis also cautioned the March figures were provisional and could be adjusted as was the case for February, with the original gain of 1.6 percent being revised down to show a fall of 0.7 percent on Friday.

The drop was sharpest in sales of food, drinks and tobacco, which in March plunged a real 9.2 percent year-on-year. The amount spent at supermarkets and hypermarkets was also 9.2 percent less than in March 2007.

For everything that was not food, the picture was a little less gloomy, with sales falling 4.3 percent.

With a strong euro hitting German exporters, Chancellor Angela Merkel's government had been counting on consumer spending to keep the economy ticking over.

But price increases may be putting paid to such hopes.

Preliminary data on Monday showed that consumer prices fell 0.2 percent in April from March but were up 2.4 percent from April last year due to higher food and energy costs.

Although more moderate than the 3.1 percent recorded for March, inflation is still above the European Central Bank's preferred rate of just under 2.0 percent in annual terms.

Analysts also noted the outcome was also due in part to a shift in Easter holiday travel plans that would likely result in a correction next month.

Story continues below…

"It is ... becoming clear that at present the best economic policy is to fight inflation. It is a long time since it was so important," Dekabank economist Andreas Scheuerle said on Friday.

The German economy had long seemed surprisingly resilient despite the slowdown in the United States, the international credit squeeze, a strong euro and rising prices.

But recent data and sentiment indicators have set alarm bells ringing, with the Ifo index of business giving clear evidence last week that German industry could be entering a period of weaker activity.

A better-than-expected reading in the GfK consumer confidence index on Monday gave grounds for optimism, however, with all three sub-categories in the index registering increases.

Facebook Twitter Google+ reddit

Today's headlines
Creepy clown scare spreads to Germany
Two of the clowns were apparently equipped with chainsaws. Photo: Pedro Pardo / AFP file picture

Police said Friday five incidents involving so-called scary clowns had occurred in two north German town, including one assailant who hit a man with a baseball bat, amid fears that Halloween could spark a rash of similar attacks.

Student fined for spying on women via their webcams
Photo: DPA

Student from Munich fined €1,000 for spying on 32 different computers, using their webcams to take photographs, or record their keyboard history.

This is how much startup geeks earn in Germany
Photo: DPA

A comprehensive new survey of 143 startup founders shows how much you are likely to be earning at a German startup, from entry level all the way up to sitting on the board.

Man dies after beating for peeing near Freiburg church
The Johannes Church in Freiburg. Photo Jörgens Mi/Wikipedia

A middle-aged man from southern Germany has died after being attacked by a group of men who took umbrage with the fact he was urinating in the vicinity of a church.

The Local List
Seven German celebrities with uncanny doppelgängers
Former Berlin mayor Klaus Wowereit and actor Alec Baldwin. Photo: DPA; Gage Skidmore, Wikimedia Commons

Check out these seven look-a-likes of well known German figures - we admit that some are more tenuous than others...

Israel seeks to buy three new German submarines: report
A Dolphin class submarine. Photo: DPA

Israel is seeking to buy three more advanced submarines from Germany at a combined price of €1.2 billion, an Israeli newspaper reported Friday.

Here’s where people live the longest in Germany
Photo: DPA

Germans down south seem to know the secret to a long life.

More Germans identify as LGBT than in rest of Europe
Photo: DPA

The percentage of the German population which identifies as lesbian, gay, bisexual or transgender is higher than anywhere else in Europe, according to a new study.

'Reichsbürger' pair attack police in Saxony-Anhalt
File photo: DPA.

A "Reichsbürger" and his wife attacked police officers on Thursday, just a day after another Reichsbürger fatally shot an officer in Bavaria.

Five things not to miss at the Frankfurt Book Fair
Photo: DPA

From consulting a book doctor to immersing yourself in an author's world with the help of virtual reality, here are five things not to miss at this week's Frankfurt Book Fair, the world's largest publishing event.

Sponsored Article
How to vote absentee from abroad in the US elections
10 things you never knew about socialist East Germany
Sponsored Article
Last chance to vote absentee in the US elections
How Germans fell in love with America's favourite squash
How I ditched London for Berlin and became a published author
Sponsored Article
How to vote absentee from abroad in the US elections
12 clever German idioms that'll make you sound like a pro
23 fascinating facts you never knew about Berlin
9 unmissable events to check out in Germany this October
10 things you never knew about German reunification
10 things you're sure to notice after an Oktoberfest visit
Germany's 10 most Instagram-able places
15 pics that prove Germany is absolutely enchanting in autumn
10 German films you have to watch before you die
6 things about Munich that’ll stay with you forever
10 pieces of German slang you'll never learn in class
Ouch! Naked swimmer hospitalized after angler hooks his penis
Six reasons why Berlin is now known as 'the failed city'
15 tell-tale signs you’ll never quite master German
7 American habits that make Germans very, very uncomfortable
Story of a fugitive cow who outwitted police for weeks before capture
Eleven famous Germans with surnames that'll make your sides split
The best ways to get a visa as an American in Germany
jobs available
Toytown Germany
Germany's English-speaking crowd