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The value of Europe retail falling down

Staff writer ▼ | July 31, 2013
The eurozone retail sector neared stabilization in July, Markit's retail PMI data showed. The value of retail sales fell for the 21st month in a row but at the slowest rate.
Retail
RetailThe eurozone retail sector neared stabilization in July, Markit's retail PMI data showed. The value of retail sales fell for the 21st month in a row but at the slowest rate.


Moreover, both Germany and France posted higher sales during the month, with the latter recording the first expansion since March 2012. The main negative finding from the latest survey was a sharper decline in Italian retail sales.

The Eurozone Retail PMI is a seasonally adjusted indicator of changes in the value of sales at retailers. Any figure greater than 50.0 signals growth compared with one month earlier.

"We may soon see an end to the current survey record stretch of falling retail sales in the eurozone. Unless Italy's decline moderates, an overall rise in sales looks likely to hinge on growth in France being sustained in the coming months, as strengthening growth in German retail sales has so far not been enough to wholly offset the ongoing collapse in Italian revenues.

"Throughout the survey history, German sales growth alone has never translated into an overall increase at the eurozone level," said Trevor Balchin, senior economist at Markit and author of the Eurozone Retail PMI.

Germany's retail sector registered a third successive month of rising sales in July, the longest sequence of growth for a year. Moreover, the rate of expansion accelerated further, to the fastest since January 2011.

The French retail PMI rose for the fourth month in a row in July, and registered above the no-change mark for the first time since March 2012. Moreover, the rate of growth signalled was the fastest since October 2011.

Italian retailers continued to weigh on the overall eurozone performance. Sales fell for the twenty-ninth month running, and at the strongest rate since April. Moreover, the gap between the Italian and German retail PMIs was the largest since February 2012.

Eurozone retail sales were lower on an annual basis in July, as has been the case since June 2011. That said, the rate of decline was the slowest since March 2012, and sales in Germany and France posted year-on-year growth. Italy continued to register a severe annual drop in sales, however.


 

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