According to data released by the Federal Statistical Office of Germany, retail sales rose by 11% in March (year-on-year), against expectations of 3.1% and the previous month's 6.6%. In monthly terms, retail sales rose by 7.7%, against expectations of 3% and the previous month's 2.7%.
The year-on-year figure is the biggest ever posted since the beginning of the pandemic, and is mostly linked to the fact that Germany is not attempting to lift the lockdown measures that caused the economic downturn in the first place. Sales of textiles and leather goods rose by 27.7% in yearly terms, followed by retail trade goods sales, which rose by 23%. The biggest beneficiaries during this period were online retailers, whose sales increased by 42.9%, annualized.
Markit Economics reported that the manufacturing sector expanded in April, though at a slower pace. The Manufacturing PMI stood at 66.2, lower than expectations of 66.4. In the Eurozone, the manufacturing sector also expanded, though also less than expected. The Manufacturing PMI stood at 62.9 after the previous reading of 63.3, below expectations that it would remain unchanged.
“Eurozone manufacturing is booming,” commented the chief business economist at IHS Markit. “Supply constraints are also running at unprecedented levels, leading to a record build-up of uncompleted orders at factories.”
Most European countries are now attempting to get back to normal and are amid the process of reopening their economies. Vaccination campaigns are also advancing. So far, the most affected European country is France, with 5,652,247 reported cases as well as 104,819 deaths attributed to the virus, followed by the United Kingdom, with 4,420,201 cases and 127,538 deaths, and Italy, which has so far reported 4,044,762 cases as well as 121,177 deaths.
Last week, the European Central Bank decided to leave its monetary policy unchanged, while pledging to bolster the pace of its bond purchase program. According to ECB, Eurozone economic activity contracted during the first quarter mostly due to the lockdowns caused by the third wave of the pandemic, though it expects economic activity to rebound in the second quarter.
“Incoming economic data, surveys and high-frequency indicators suggest that economic activity may have contracted again in the first quarter of this year, but point to a resumption of growth in the second quarter,” commented European Central Bank President Christine Lagarde.