Germany's retail sector experienced a mild slowdown in April 2025, with real sales declining by 1.1 percent compared to March. This retreat follows a revised growth of 0.9 percent in March, correcting earlier estimates that had suggested a contraction. Despite April's dip, year-over-year performance remained positive, with real sales up 2.3 percent compared to April 2024, reflecting underlying resilience in consumer activity.

Sectoral trends reveal a mixed picture. Food retail showed relative stability, dipping just 0.1 percent in real terms from March but rising 2.3 percent over the year, buoyed by strong nominal growth of 4.9 percent, hinting at price pressures. Non-food retail saw a sharper monthly contraction of 1.3 percent in real terms, yet still posted a 2.6 percent year-over-year gain, suggesting consumers remain engaged despite short-term fluctuations. The standout story remains the online and mail order segment, which rose a remarkable 14.1 percent year-over-year in real terms, underlining the persistent digital transformation in shopping habits.

Overall, while April brought a modest pause in momentum, annual growth across all major segments signals cautious consumer confidence and an evolving shift toward digital retail channels. This latest update takes the RPI to minus 16 and the RPI-P to minus 11, meaning that economic activities are well behind market expectations in Germany.

Sales expected up 0.2 percent on the month.

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.