German December retail sales fall more than expected

German retail sales fell more than expected in December, as tighter coronavirus-related restrictions hit textiles, clothing, shoes and leather goods, according to official data released on Tuesday.

Retail sales were down 5.5% month on month in real terms, the Federal Statistics Office said, compared with external forecasts of a 1.4% decline.

"The decline in December is believed to be related to the introduction of the 2G rule in many retail stores and the impact of calendar and seasonal adjustments due to the Christmas holidays," state statistics agency Destatis said.

The 2G rule says citizens have to be either vaccinated or recovered from Covid-19 to enter shops, restaurants, hotels and theatres.

Non-food sales in physical stores decreased 7.7% on month, sales of food beverages and tobacco fell 1.4% and demand in hyper and super markets slipped by 1.8%. Online shopping also weakened, falling 5.7% on month, pointing to a broad-based fall in demand.

Retail sales in 2021 were 0.7% higher in real terms year on year, according to provisional results. However, parts of shop-based retail trade, such as retail trade in textiles, clothing, footwear and leather products, suffered losses in turnover in the second year of the coronavirus crisis, Destatis.