German retail sales posted a surprise monthly rise in October, but analysts cautioned the figures could yet be revised and 2004 would remain a dismal year for retailers. According to data from the Federal Statistics Office released on Wednesday, retail sales rose 1.6 percent month on month in real terms, bucking expectations for a slight drop.
However, compared with October 2003, retail sales fell 3.7 percent - the largest decline in five months and significantly worse than expected.
The mid-range forecast of analysts polled by Reuters was for retail sales to fall by 0.1 percent month-on-month and decline by 2.0 percent year-on-year.
"One has to be careful because the data is provisional and revisions are often quite large. However, it is a positive start for the fourth quarter," said Stefan Bielmeier of Deutsche Bank.
Germany's economy slowed sharply in the third quarter as the export prop that had supported growth earlier in the year fell away. With global growth expected to slow in the months ahead, economists say a pick-up in domestic demand, including private consumption, is needed to support growth going forward.
According to the data, based on figures from six German states accounting for 81 percent of the total goods sold, retail sales rose 1.7 percent in nominal terms from September and fell 3.4 percent from October 2003, the Office said.
A broader October sales measure by the Bundesbank that includes turnover at petrol stations and garages, also showed a cheerier start for the fourth quarter. Sales rose 2.3 percent month-on-month, fuelled by higher oil prices and car sales, and fell by 1.3 percent year-on-year, the bank said on Wednesday.