German shoppers cut back their spending sharply in September, official data showed on Friday, adding to concern over whether consumers will help bolster growth in Europe's top economy. Retail sales posted the biggest monthly drop in September for more than seven years, the data showed.
German retailers' sales, which tend to be volatile and frequently revised, slumped 3.2 percent in September compared to the figure of August, the federal statistics office Destatis said in a statement. The drop was the biggest for the closely watched measure of household confidence since May 2007 and far exceeded the 0.8-percent fall predicted by economists polled by Dow Jones Newswires.
On a 12-month basis, business increased by 2.3 percent in September compared to the same month in 2013, Destatis said. And from January to September this year, it rose by 1.3 percent compared to the same period in 2013. Consumer confidence in Germany halted its recent declines in October, as consumers appeared to be no longer fazed by economic fallout from geopolitical crises, a poll showed last week.
And unemployment in Germany, Europe's biggest economy, fell unexpectedly this month, shrugging off a slowing economy. But recent data has suggested that the German economy - traditionally Europe's growth engine - is stalling, threatening to pull the eurozone back into recession and put the brakes on the global recovery. Meanwhile official data in France showed that household spending there fell by 0.8 percent in September, after a rebound of 0.9 percent in August, but over the third quarter it edged up by 0.2 percent.
In July, spending had fallen by 0.8 percent. Consumer spending is of central importance to growth in France, which is currently extremely weak. France, with the second-biggest eurozone economy after Germany, is trying to boost exports to reduce a huge trade deficit, in contrast to German's big trade surplus.
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