Retailing (Germany):
Increased confidence

In retailing the business situation improved again, with the exception of the consumer durable area. Also the expectations, which in November had reached a low point in light of the imminent value-added tax increase, were marked by increased confidence in April. Retailers plan to exercise caution in their ordering, however, since their inventories of unsold goods continue to be assessed as too large. Price increases were only reported in the food and beverage sector; in the non-food sector some price weakening was evident. According to the survey responses, however, there should be more scope for price increases in the coming months. The number of employees is expected to rise. The improvement of the business situation and outlook was stronger in eastern German retailing than the federal average, although the negative judgments in these two components of the business climate still held the balance. Since inventory pressure has again become more noticeable, the order plans point to further restrictions. For the coming months, firms expect slight price increases.