Title: German Retail Sales Post Biggest Rise in 6 Months in July

Sep 01, 2022 02:46AM ET

By: AnalysisWatch

In July, German retail sales increased the most in six months, as COVID-free summer tourism prompted consumers to open their wallets despite painfully high fuel and fare prices.

Sales rose 1.9% in real terms, adjusted for inflation and seasonal and calendar effects. This more than offset June's decline and far exceeded analysts' estimates, which had predicted a further decline of 0.4%.

In year-on-year terms, the decline in sales was down to 2.6% from 9.6% in June, which was also ahead of expectations.

The figures were stamped by the continued rise in petrol prices: pump sales rose 1.3% month-on-month and were 7.5% higher than in May, the month before the government introduced a temporary fuel rebate.

Grocery sales rose 2.1% month-over-month but were still down 4.4% from March and 6.1% year-over-year, partly reflecting the reopening of restaurants after the pandemic subsided.

Other pandemic-related effects were also evident, as sales at home appliance and DIY stores fell another 0.1% and were down 9.8% year-over-year.

He said he still expects a decline in August and September as the expiration of the tariff reduction is likely to lead to a significant reduction in fuel spending. This would be in line with the sharp drop in consumer confidence already seen in the past two months.

Vistesen expects sales to fall by around 0.3% in the third quarter, having already fallen by 3.6% in the second quarter.