Retailing (Germany):
Climate improves

In retailing the current business situation was assessed as slightly less favourable due primarily to a clear worsening for non-durable consumer goods. The outlook brightened, however, in general, after having been regarded sceptically in the previous five months. Since inventory pressure has not lessened, however, firms plan to be more reserved in their new orders. According to the survey responses, price increases in the coming months will be more pronounced, with hikes particularly expected in the food and beverage sector. As in the previous month, staff reductions are only anticipated by 6% of the firms, on balance. One year ago it was twice as many firms. Deviating from the federal average, retailers in eastern Germany judged their business situation again more positively than in the previous month. Since they remain sceptical, however, with respect to future business and anticipate enlarged inventories, their order plans are more restrictive. They see room, however, for being able to push through higher prices in the coming months.