November 30, 2016 / 7:15 AM / 8 months ago

German retail sales post sharpest rise in more than 5 years in Oct

2 Min Read

BERLIN, Nov 30 (Reuters) - German retail sales rose at their fastest pace in more than five years in October, data showed on Wednesday, reinforcing expectations that private consumption will remain the main growth driver in Europe's largest economy this year.

The volatile indicator, which is often subject to revision, showed retail sales rose by 2.4 percent on the month in real terms, the Federal Statistics Office said.

This was the highest increase since June 2011 and more than double the forecast in a Reuters poll for a 1.0 percent rise.

A breakdown of the data suggested that the rise was mainly driven by growth in e-commerce as well as clothing and shoes sales.

On the year, retail sales fell by 1 percent in real terms, the data showed, undershooting the Reuters consensus forecast of a 1.0 percent increase.

The monthly figure for September was revised down to a fall of 1.5 percent from a previously reported dip of 1.4 percent. The yearly value was revised up to an increase of 0.6 percent from a previously reported rise of 0.4 percent.

The strong data came after a survey by the GfK research institute showed last week that the mood among German consumers improved unexpectedly heading into December.

Germany's HDE retail association expects overall nominal sales to grow by 2.5 percent this year.

Record-high employment, rising real wages and ultra-low borrowing costs have boosted the spending power of Germans, making consumption the main driver of growth in a traditionally export-driven economy. (Reporting by Joseph Nasr; Editing by Madeline Chambers)

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