GERMAN retail sales dropped in February but remain at high levels that are expected to lead to better growth this year.
Retail sales fell by 0.5 per cent from January to February according to figures released yesterday by Destatis, Germany’s statistical office.
However, sales were 3.6 per cent higher than a year before. Sales in the first two months of this year have already surpassed sales in the final three months of 2014.
Christian Schulz, an economist at Berenberg Bank, said it “points to a very strong contribution from private consumption to GDP growth in early 2015.”
And other data imply strong consumption going forward, Schulz said. “Normal wage growth just below three per cent year-on-year and near-zero inflation [0.3 per cent year-on-year in March], along with rising employment [up 0.9 per cent year-on-year in February] comfortably support consumption growth well above two per cent this year.”