Berlin — Germany’s retail sales rose unexpectedly in November, despite Tuesday’s data renewing regulations on COVID-19 that prevented consumer-led recovery in Europe’s largest economy. Recorded a record high.
Retail sales increased 0.6% per month on a real basis, according to the Federal Bureau of Statistics. This exceeded expectations that Reuters would fall 0.5%.
Retail sales in 2021 increased 0.9% on a real basis and 3.1% on a nominal basis, a record high despite curtailed non-essential store visits.
“The coronavirus regulations have been updated and tensions will continue for the foreseeable future,” said Alexander Krueger, an analyst at Hauck Aufhaeuser Lampe Private Bank.
He added that it would be difficult for manufacturing to close the overall output gap created by weak consumption, as the industry is still struggling with a shortage of microchips and other components.
GfK’s market research agency said last month that consumer morale would worsen as the rise of pandemic and Omicron variants pushed the economy to the brink of recession.
The Ifo Institute for Economic Research predicts that the German economy will shrink 0.5% quarterly in the last three months of 2021 and stagnate in the first three months of 2022. This brings Germany closer to a technological recession, defined as a contraction for the second consecutive quarter.
The high prevalence during the German 4th coronavirus wave caused by the delta mutation has already imposed restrictions on retailers and service providers in December.
Germany has banned unvaccinated people from entering non-essential facilities. The so-called 2G rules, accessible only to vaccinated or recovered people, have hit the Christmas business.
The rapid spread of Omicron variants has clouded retailers’ outlook as early as 2022.
Prime Minister Olaf Scholz and the State Prime Minister are expected to discuss further measures and restrictions at the Pandemic Emergency Meeting on Friday.
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