Europe Retail Sales Decline Least in 16 Months, PMI Shows
European retail sales fell the least in 16 months in September, adding to signs the region’s economy may be emerging from recession.
The measure of euro-area sales rose to 48.6 from 47.1 in August when adjusted for seasonal swings, London-based Markit Economics said today. The index, which is based on a survey of more than 1,000 executives, has remained below the 50 mark that indicates a contraction since June of last year.
The euro-area economy is showing signs of recovering from its worst recession in six decades after governments stepped up stimulus measures and the European Central Bank cut rates to a record low and injected billions of euros into markets. Germany and France, the region’s largest economies, unexpectedly returned to growth in the second quarter, and German business confidence rose to a 12-month high in September.
The retail-sales gauge for France rose to 50.5, indicating the first expansion since January, from 47.3 the previous month, while in Germany, Europe’s biggest economy, the measure fell to 47.9 from 49.5, according to today’s report. In Italy, the euro area’s third-largest economy, the index rose to 47.2 from 44.0, though it was the 31st monthly decline. The three economies account for more than 60 percent of European sales.
Inditex SA, the world’s largest clothing retailer, said on Sept. 16 that revenue climbed 9 percent in the first half, excluding currency swings, and that it aimed for stronger same- store sales in the second half. Hennes & Mauritz AB, Europe’s second-biggest clothing retailer which has around half its sales in euros, posted a 4 percent increase in third quarter profit as revenue grew 13 percent.
Unemployment Slows
The pace of job losses in the retail industry slowed to the least since August 2008, today’s report showed. Overall unemployment in the euro region probably rose to 9.6 percent in August from 9.5 percent in July, according to the median forecast from a Bloomberg News survey of 23 economists. The European Union’s statistics office publishes unemployment data on Oct. 1.
Prices paid by retailers rose “modestly” in September, while in Germany prices fell the most since the survey started, the Markit report said. European consumer prices fell 0.2 percent from a year earlier in August, after declining 0.7 percent in July, the most in the euro’s history.
European confidence in the economic outlook probably increased for a sixth month in September, according to a survey of economists by Bloomberg. The European Commission in Brussels will publish that report later today. Euro-area gross domestic product fell 0.1 percent in the second quarter, after plunging 2.5 percent in the previous three months, the biggest drop since at least 1995.
The economy will grow about 0.2 percent in 2010 after contracting around 4.1 percent this year, according to forecasts from the ECB, which has cut its benchmark interest rate to a record low 1 percent and created a program to buy covered bonds to stimulate bank lending.
Filed under: term by Wolf