January Retail Sales Growth Sags

Unemployment at its highest rate since World War Two cut into retail sales in Germany at the beginning of the year, bringing an index compiled by Bloomberg from 54.8 in December to 51.6 in January. The survey was based on responses from 500 purchasing managers in Germany. Consumption has been on the decline or stagnant for three years, as consumers have been reluctant to spend due to fears about their economic futures. Several large German companies, such as Deutsche Bank and Siemens, have been cutting jobs and wages. Others have been moving production overseas. But the worst may by over for consumers, according to several executives taking part in the survey. A tax cut by the government and high demand for exports have led companies to step up investment. "Our customers in Europe expect a better year [this year]," Bruno Sälzer, CEO of clothing maker Hugo Boss, told Bloomberg. "Consumer spending in Germany should pick up soon."