Consumers in the eurozone held back from spending by more than expected in April, sending retail sales falling by the biggest margin so far this year, as rising unemployment eats into households' ability to splash out on cars and clothes. Sales at shops in the 17 countries sharing the euro fell 1.0 percent in the month from March, the EU's statistics office Eurostat said on Tuesday, tumbling 2.5 percent on an annual basis.
Highlighting the worsening economy, both readings were well below forecasts of economists polled by Reuters, who saw contractions of 0.1 percent and 1.1 percent respectively. With more than 17 million people out of work in the euro zone and governments laying off staff and freezing the salaries of those who remain, households are unable to help revive the stagnant economy.
While consumers spent a little more on food and drink in April, with trade in that sector rising 0.3 percent, purchases of all other items including clothes, cars, furniture and computers fell 1.4 percent in the month. The impact of the bloc's debt crisis and austerity measures were notable in the spending patterns of wealthy Belgium and France, where retail sales fell 1.2 percent and 1.5 percent respectively from the previous month.
German shoppers did spend more in April, reflecting the relatively ruder health of Europe's top economy, but the increase was moderate at just 0.6 percent compared to March. Marking the widening divide between northern and indebted, southern Europe, retail sales fell 2.4 percent in Spain and by 2.1 percent in Portugal. Data for Greece and Italy was not provided by Eurostat.
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