German retailers see a slower growth of sales on consumer uncertainty

German retail sales increased in 2024, but growth should be more modest this year due to the high level of uncertainty, according to the HDE retail association.

Last year, retail sales increased 1.1% compared to the previous year in terms adjusted by inflation, according to official data on Friday. HDE predicts a growth of 0.5% in real terms this year.

“The consumption and the retail sector in Germany will not gain impulse in 2025,” said HDE managing director Stefan Genth.
“There is simply too much uncertainty,” he said. “Wars, high energy costs and general economic stagnation are a toxic cocktail for consumption.”

In nominal terms, retail sales increased 2.5% in 2024 and are expected to grow 2.0% in 2025, according to the HDE forecast.

The latest HDE survey with 700 retailers shows that 22% of respondents expect sales to increase this year, while almost half of them expect the results to be below the level of the previous year.

In December, retail sales fell 1.6% compared to the previous month, according to official data. The analysts had predicted a 0.2%increase.