German retailers face festive sales slump – HDE
2022.11.10 04:59
© Reuters. FILE PHOTO: Shoppers carry bags as they walk near the luxury department store Kaufhaus des Westens (KaDeWe), amid the coronavirus disease (COVID-19) pandemic in Berlin, Germany, December 14, 2020. REUTERS/Michele Tantussi/File Photo
BERLIN (Reuters) – German consumers and businesses are facing a difficult Christmas shopping season in light of double-digit inflation and high energy prices, the HDE retail association said on Thursday, forecasting a decline in sales in price-adjusted terms.
In the last two months of 2022, the HDE retail association expects sales to rise by 5.4% year on year in nominal terms, it said. However, in price-adjusted terms, sales face a 4% decline, it added.
“Sales are only growing through inflation-driven price increases. This remains a difficult time for retail companies,” HDE managing director Stefan Genth said.
“There is a great deal of uncertainty among both companies and customers in view of the difficult situation with enormous energy price increases. High inflation and poor consumer sentiment do not really bode well for the Christmas season,” he said.
The association said 70% of the 500 companies it surveyed said they expect to do worse business this festive season than last year.
In October, the harmonised inflation rate in Germany’s largest economy climbed to 11.6%. The government and economists broadly expect the country to enter a recession this winter.
