- Prior -0.1%; revised to -0.3%
Death, taxes, and German retail sales disappointing estimates. It’s almost the case every time, innit? This is a very, very poor reading with the annual estimate also now falling into negative territory (-2.0%) in real terms.
This reflects the pessimism tied to the situation in the Middle East, with surging energy prices weighing on consumer activity. Food sales were seen down 2.7% on the month while non-food retail trade also declined by 1.0% on the month. As higher prices come into the picture across multiple fronts, households will have to think twice about making certain purchases.
And the continued negativity is persisting as we get into next month still. From earlier this week: Germany May GfK consumer sentiment -33.3 vs -29.3 expected
The longer the war drags on, expect that to exert a bigger toll on the German economy. And that doesn’t bode well for the ECB as there will be concerns about stagflation soon enough.
This article was written by Justin Low at investinglive.com.
