Germany: Fourth quarter starts with a cold shower - ING

The ING Analysts express their take on the downbeat German Retail Sales report released earlier on Black Friday.

Key Quotes:

“Getting worse before it gets better. German retail sales dropped by 1.9% month-on-month in October, from 0% in September.

On the year, retail sales were still up by 0.8%. While retail sales are often revised significantly in the second and third estimates, this reading is a cold shower for the German economy, giving a slightly different meaning to "Black Friday".

Even though today’s retail sales were a bad start to the final quarter of the year, private consumption should continue supporting German growth in the near term. In the longer run, however, it is questionable how sustainable any upcoming spending sprees might be. We expect more discussions about the sense and nonsense of consumption-driven economic growth. There probably is no better illustration of this contradiction than on a day which celebrates both "Black Friday" and "Fridays for Future".“