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Germany's retail sales declined in September, defying expectations for a rebound, as high inflation and interest rates continued to damp spending.
Retail sales fell 0.8 percent month-on-month following a 1.2 percent slump in August, preliminary data from the statistical office Destatis showed Tuesday. Economists had forecast a 0.5 percent gain.
Sales of food grew 2.2 percent from the previous month, while those of non-food goods shrunk 3.7 percent.
Internet and mail order sales declined 3.7 percent compared to the previous month.
On a year-on-year basis, retail sales decreased 4.3 percent in September after a 2.3 percent fall in the previous month. Economists were looking for a 4.0 percent gain.
Preliminary data released on Monday showed that the German economy shrank less than expected, by 0.1 percent, in the third quarter, reversing an upwardly revised 0.1 percent in the previous three months.
Although the breakdown of GDP was unavailable, the statistical office said household spending was lower.
Separate official data showed that consumer price inflation in Germany slowed more than expected to 3.8 percent in October, it lowest in over two years due to falling energy prices.
While easing price pressures validate the latest "pause" in the interest rate hikes by the European Central Bank, the big question is if the trend is sustainable given the significant risks to the outlook.
Consumer confidence in Germany is set to weaken further in November, survey results published jointly by GfK and the Nuremberg Institute for Market Decisions, showed last week, adding to fears of a recession as private consumption is unlikely to be a pillar of the economy.
