German retailers see strong sales growth in December
Staff Writer |
German retailers had a strong finish to 2017 as sales growth hit an eight-month high in December, according to the latest PMI survey data from IHS Markit.
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The positive performance was also reflected in a pick-up in the rate of job creation in the sector, while gross margins stabilised after having contracted in each of the previous 17 months.
The seasonally adjusted headline Germany Retail PMI moved to 55.1 in December, up from 54.6 in November and its highest reading since April.
The latest figure implied a strong monthon-month rise in sales, which the survey’s anecdotal evidence partly linked to greater spending power among consumers.
Sales were also up on the same month one year ago, although the rate of growth was slower than that seen in November.
Thanks to the pick-up in sales in December, retailers were able to meet their targets (on average) during the month.
This ended a run of seven straight months of underperformance, with April being the only time in 2017 when retailers surpassed their plans.
Retailers’ expectations towards future sales performance meanwhile remained positive, despite the level of confidence having weakened from November’s eight-month high.
Factors expected by survey respondents to support sales in the coming months included spring weather, improving consumer sentiment and increasing disposable income.
Retailers maintained a preference for higher staffing numbers in December, with employment in the sector rising for the third month running and to the greatest extent since June.
However, despite the pick-up in job creation at the end of the fourth quarter, the average rate of employment growth across the year as a whole was the lowest seen since 2010.
December saw a ninth straight monthly increase in retailers’ spending on goods for resale.
Although slightly slower than that recorded in the preceding survey period, the rate of growth in purchasing activity remained solid and was well above the historical average (since 2004).
Similarly, stock levels rose at a solid pace during the month, albeit one that was weaker than that recorded in November. ■