Well August retail sales in Germany don't look any too happy (and here).
The German consumer showed no sign of springing into life last month, despite the strong growth in Europe’s largest economy, official figures showed on Friday.
Retail sales in German were unchanged in August after a revised 0.8 per cent fall in the previous month, according to the Federal Statistics Office.
Sluggish consumer spending has long been the Achilles’ heel of Germany’s economy, dragging down the eurozone’s overall performance. But the latest figures surprised analysts who had expected a rise on the back of one of the strongest German growth performances for years in the first six months of 2006, powered by the country’s industrial sector.
Bloomberg suggests that the last quarter may be stronger:
``Retail spending growth looks to have slowed noticeably in the third quarter, which will contribute to a slowdown in economic Growth,'' said Sandra Petcov, an economist at Lehman Brothers International in London. ``But we do expect spending to pick up in the fourth quarter ahead of the VAT increase.''
But isn't that just the point, if they pick-up before the rise, what will they do after it? Actually the 'disappointment' may come from the fact that people expected more bounce before the VAT rise, and not getting it makes next year look even more complicated.
Also, according to the FT, and tucked away at the bottom, unemployment in France seems to have risen ever so slightly:
"Separately, France reported an unexpected rise in unemployment in August. The jobless rate rose to 9.0 per cent in August from 8.9 per cent in July."
This is not deeply significant, but again it is hardly good news. The French economy is consistently outperforming the German one, and the whole prognosis there is different. France may slow, but I doubt they will have a recession in 2007.