German retail sales rise more than expected in May

German retail sales rose more than expected in May, according to the latest figures from Destatis.

Retail sales were up 0.9% on the month versus expectations of a 0.7% increase and compared to a 0.3% decline in April.

On the year, retail sales pushed up 2.6%, which was below economists’ expectations of a 3% rise and down from an upwardly revised 2.7% gain in April.

Pantheon Macroeconomics said the headline was strong, “especially given the significant upward revisions of last month’s data, but it likely won’t be enough to present a sharp slowdown in Q2.

“Assuming sales were unchanged in June, which is a fair bet, the quarter-on-quarter rate would slump to a 0.6% fall in the second quarter, following a 0.3% increase in Q1. These data are much more volatile than the household consumption data, though, and we doubt the hit to GDP will be that bad.”