Real and nominal sales rose 1.6 percent month-over-month in August, growing slightly more than July's 1.5 percent. The growth over the last two months indicates recovery from the prior two months which showed 1.4 percent and 1.1 percent declines in May and June respectively.

Real retail sales increased by 2.1 percent in comparison to August 2023, while nominal sales increased by 3.1 percent, suggesting that inflation had a bearing on pricing. Food retail sales saw robust growth, increasing by 1.9 percent month-over-month and 2.4 percent year-over-year. Growth in the non-food sector was more modest, with a 1.1 percent monthly increase and a 1.2 percent annual increase.

Furthermore, online and mail-order retail rose 8.9 percent from July 2024 and 10.8 percent year-over-year, underscoring the increasing importance of e-commerce. The return to consistent data provision, which is crucial for the monitoring of economic trends, is marked by the resumption of regular retail sales reporting following IT disruptions earlier in the year. This latest report implies that consumer spending may be starting to recover although confidence remains weak. Overall German economic activity is now running slightly ahead of market expectations with the RPI at 14 and the the RPI-P at 25.

Retail sales measure the total receipts at stores that sell durable and nondurable goods. The data are compiled from about 27,000 retail businesses and are reported in both nominal and volume terms. Autos are excluded. A very limited breakdown of subsector performance is available in the initial report which is itself subject to sometimes sizeable revision but much greater detail is provided in the following month's release.

With consumer spending a large part of the economy, market players continually monitor spending patterns. Retail sales are a measure of consumer well-being. The pattern in consumer spending is often the foremost influence on stock and bond markets. For stocks, strong economic growth translates to healthy corporate profits and higher stock prices. For bonds, the focus is whether economic growth goes overboard and leads to inflation. Ideally, the economy walks that fine line between strong growth and excessive (inflationary) growth.

Retail sales not only give you a sense of the big picture, but also the trends among different types of retailers. Perhaps auto sales are especially strong or apparel sales are showing exceptional weakness. These trends from the retail sales data can help you spot specific investment opportunities, without having to wait for a company's quarterly or annual report. However, by excluding the services sector, changes in retail sales data can differ significantly from those in total household spending.