Real, seasonally adjusted retail sales:

October: -2.8% m/m, -0.8% y/y

MNI survey median: -0.1% m/m, -0.9% y/y
MNI survey range: -1.0% to +0.6% m/m

September: +0.5% m/m, -3.4% y/y (revised from +0.8%/-0.4%)

FRANKFURT (MNI) – Retail sales in Germany fell in real terms faster
than even the most pessimistic analysts had projected in October to
their lowest level since August 2009, the Federal Statistical Office
reported on Friday.

The 2.8% monthly decline – the fastest since January 2009 – erased
September’s brief 0.5% recovery and brought levels down 0.8% in annual
terms. October’s sales were down 2.6% compared to the third quarter,
which in turn was 0.6% lower than 2Q.

Nominal turnover was 2.5% lower on the month, but managed a 1.6%
rise on the year.

In annual terms, food drink and tobacco sales increased 0.6%.
Non-food sales were down 1.8%, with declines in all major components
excluding internet and mail order sales.

November’s Markit retail PMI showed sales broadly stable at 50.2
after 50.3 in October. Respondents blamed subdued consumer sentiment for
the stagnation and were not optimistic about Christmas holiday sales,
according to the report.

“The latest survey suggests that negative sentiment about year-end
sales is the most widespread since that reported ahead of the Christmas
period in 2008,” said Markit senior economist Tim Moore.

Business expectations among retailers polled by the European
Commission recovered somewhat in November from a 32-month low, though
were still well below the long-run average.

Households’ willingness to spend remains strong, supported by
ongoing stability in the labour market, the GfK Group reported earlier
this week. More optimistic than the PMI survey, the market research firm
also projected higher nominal revenue for retailers this holiday season
compared to last year.

“All in all, we can expect a very positive Christmas business,”
said GfK retail expert Wolfgang Adlwarth.

— Frankfurt bureau: +49-69-720-142; email: —