By Emese Bartha
FRANKFURT--German retail sales fell in line with expectations in
February, slightly reversing the solid expansion seen in the
previous two months, while the annual reading suggests that
consumer spending remains a key pillar of growth in Europe's
largest economy.
Retail sales in February fell by 0.5% in calendar- and
seasonally-adjusted terms compared with January, the Federal
Statistics said Tuesday. The figure was in line with forecasts from
economists polled by The Wall Street Journal.
On an annual basis, retail sales expanded by 3.6%, reaching the
highest real growth in any February since 2000, the statistics
office Destatis said.
German retail sales indicators are volatile and prone to large
revisions. Analysts tend to consider the monthly numbers with
caution and look instead at three-month averages.
The data comes on the heels of recently strong consumer
confidence data. GfK market research group's monthly survey showed
last week that German consumer confidence is set to improve further
in April, buoyed by a weak euro and low energy costs, interpreted
as supportive factors for the economy and for individuals' own
circumstances. The forward-looking GfK consumer sentiment index was
predicted to rise to 10.0 points in April from 9.7 points in March,
its highest level since October 2001, and beating economists'
forecast of a rise to 9.9 points.
Rock-bottom interest rates, rising wages coupled with low
inflation, and record high employment have also boosted consumer
optimism.
-Write to Emese Bartha at emese.bartha@wsj.com