Upswing in retail: Ifo Institute predicts positive development

Upswing in retail: Ifo Institute predicts positive development

There are signs of a positive development in German retail. According to the Munich Ifo Institute, the mood in the industry improved in April, while the Federal Statistical Office reported an increase in sales in March. Adjusted for price and seasonal effects, retailers recorded an increase in sales of 1.8 percent compared to the previous month.

The sentiment surveyed by the Ifo rose by three points to minus 14.5 in April. In particular, the assessment of the current situation was less negative. The increase in real incomes led to increased consumption, which in turn boosted retail. According to Patrick Höppner, an expert at the Ifo Institute, this is expected to be an important support for the overall economy in 2024.

Hardware stores, DIY stores and clothing retailers in particular benefited from the improved situation. The proportion of companies complaining about low demand fell significantly. The shortage of skilled workers in retail has also eased slightly, although a third of companies still have difficulties recruiting skilled workers.

In March, grocery stores recorded a 4.1 percent increase in sales compared to the same month last year, while non-food retail sales fell by 1.7 percent. Overall, the positive development in retail indicates a potentially stabilizing effect on the overall economy.