Retailing (Germany):
Slightly improved business climate

The business situation in retailing was again evaluated a little more favourably. This is due to an upward development in the non-food area, whereas in the food and beverage sector the positive assessments clearly lost ground. The firms are still confident with regard to future business development, but in light of high inventory pressure plan to retain their cautious order policies. Only food and beverage retailers expect price increases in the coming months, but the number of these responses has declined. A major change in personnel levels is not expected in the near future (on balance, 3% of the enterprises expect a decline in employee numbers). A clear improvement of the business situation was reported in eastern German retailing; with respect to the business outlook for the coming half year, however, scepticism continued to prevail. Although excess inventories have been reduced somewhat, order plans continue to be restrictive. Price increases should weaken further in the coming months; various firms also expect staff reductions.