Low expectations for Christmas business in the retail sector
The business situation in the retail sector has brightened before the start of the hot phase of the high-turnover Christmas business. The barometer rose to minus 8.8 points in November, compared to minus 13.5 points in October, according to the Munich-based Ifo Institute's business survey on Tuesday.
This is the first increase in three months. "Despite retailers' somewhat improved mood, demand, which has been weak all year, remains challenging even in the high-turnover pre-Christmas period," said Ifo expert Patrick Höppner. Christmas business is therefore unlikely to provide any major impetus this year. Expectations for the coming months also remain pessimistic.
The situation remained particularly tense for furniture stores and DIY stores. The business situation was also largely gloomy for retailers of consumer electronics and toys - both popular gift items for the present table. The situation was better for food retailers and car dealers.
The slowdown in inflation could provide new impetus in the coming year. "As in the economy as a whole, price increases in the retail sector are likely to continue to weaken in the coming months," said Höppner. Price pressure is easing, particularly in the food sector. Price increases have recently been observed even more frequently in supermarkets than in other retail sectors.
The industry association HDE expects sales of 120.8 billion euros for November and December, an increase of 1.5 percent. Excluding price increases, this would be a real decline of 5.5 percent. The industry was satisfied with business over the past few days. "Even if there has been a lack of momentum so far, it is clear that things started to improve in the week before the first Advent," said HDE Managing Director Stefan Genth. "With the Advent season and the numerous Christmas markets, the festive mood is now starting to set in."
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Despite the increase in the Ifo survey indicators for retail trade, expectations for the Christmas business remain challenging due to weak demand, suggesting that the retail sector may not see significant growth during this period. Furthermore, expectations for the coming months in the retail sector also remain pessimistic, as stated by Ifo expert Patrick Höppner.
Source: www.ntv.de
