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Economy in Brief

German Retail Sales Lose Some Weakness
by Robert Brusca May 28, 2009

Retail sales are falling on a Yr/Yr basis but, in recent months, spending has been higher; over three months spending (ex-autos) is actually rising. As we saw in the first quarter German GDP report, consumers have been mildly affected by the German downturn but the real weakness has been in the industrial measures such as business investment, exports plus in housing. Find that retail sales are holding up is a good sign that the German recession is not spreading and that its social welfare support system is holding together the ability of consumers to participate in the economy.

German consumption figures are somewhat encouraging. Still the German consumer is not likely to be an engine of growth. Consumption is a core part of GDP that is stabilizing and that is an important contribution. The industrial weakness is still present and remains a threat, But that depends on demand elsewhere since the threatening weakness is to German investment goods output and exports. Exports remain weak.

German Real and Nominal Retail Sales QTR
Nominal Apr-09 Mar-09 Feb-09 3-MO 6-MO 12-MO YrAgo Saar
  Retail Ex auto 0.9% -0.6% 0.2% 2.0% -2.7% -0.4% -1.6% 3.5%
Real                
  Retail Ex auto 0.5% -0.4% 0.0% 0.4% -1.5% -0.3% -4.5% 1.5%
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