German retail sales post monthly drop in February

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German retail sales gained an annualised 1.1 percent in February, provisional price-adjusted data released on Thursday showed, but fell by 0.3 percent from January amid a dip in consumer sentiment.

Retail sales in the biggest European economy had gained 0.4 percent in January, according to final figures that were revised lower by the national statistics office, from an initial estimation of 1.4 percent.

Analysts polled by Dow Jones Newswires had expected a month-on-month increase of 0.4 percent in February as well.

The picture was a bit brighter in nominal terms, with the Destatis office reporting a monthly gain of 0.8 percent and an annualised increase of 3.0 percent in February.

On Tuesday, the GfK market research group said German consumer sentiment had declined slightly for the first time in 10 months owing to growing concern over the international environment and inflation.

The German retail sales figures were calculated on the basis of data provided by seven states that account for 76 percent of all sales.

The monthly decline in February resulted from weaker sales of food, drinks and tobacco, which altogether were 2.0 percent lower at constant prices, Destatis said.

It might therefore take awhile before German consumption contributes significantly to growth, as many economists have forecast would happen this year.

Across the 17-nation eurozone, overall economic sentiment declined in March to an indexed 107.3 points, official data showed on Wednesday, owing to weaker results in the retail and construction sectors, and among consumers.

© 2011 AFP

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