German reatail sales fell more than forecast in October

Retail sales in Germany surprisingly reported a decline of 0.4% in October, below analysts' forecasts for growth of 0.3 percent after zero change the previous month.
The result fueled fears that the biggest economy in the Eurozone loses speed and strengthens expectations the European Central Bank to announce an extension of stimulus measures at its meeting on Thursday.
On the other hand, retail sales achieved an increase of 2.1% yoy, although this result was below expectations for a recovery of 2.9 percent. Purchases of food, beverages and tobacco were up by 2.3% and non-food products - by 1.8 percent.
For the first ten months of the year, the index recorded its most significant growth since 1994, or 2.8%, due to the steady performance of the labor market and low interest rates that do not encourage consumers to save money.

"People keep spending money because their job situation is good, and the record-influx of refugees also increases demand," an official at the Statistics Office said.

German consumers are benefitting from record employment, rising wages and nearly stable prices while low interest rates are giving them little incentive to save and cheap energy is freeing up additional cash for spending.

A survey showed last week that morale among German consumers declined less than expected running into December with the willingness to buy even improving, in a sign that Christmas shoppers are prepared to open their wallets.