Retailing (Germany):
Business situation again improved

In retailing the business situation was evaluated clearly more favourably than in the previous month. But although inventories have been reduced somewhat, the retailers are still cautious in terms of orders. The pressure to increase retail prices continues to be high, particularly for food and beverages. The business climate improved especially in retailing with consumers durable, such as furniture or entertainment electronics. On the other hand, strong losses in comparison to the previous year level were reported by textile retailers, shoe retailers and service stations. With regard to the six-month business outlook, the retailers are as cautiously optimistic as before. Accordingly, they also plan only moderate increases in staff levels. The improvement in the Ifo Business Climate for industry and trade in Germany in May came from consumer-oriented areas. In the entire chain of consumer good producers, consumer goods wholesalers and down to the retailers, the business climate improved. Although not a distinct breakthrough, this is at least a glimmer of hope for private consumption in Germany.