German retail sales post surprise rise in April

German retail sales rose by an unexpected 0.5 per cent in April from March, official statistics showed Friday, suggesting that consumption could help ease the country's historic recession.

Analysts had expected retail sales, adjusted for calendar and seasonal effects, to slip by 0.1 per cent on the month, in part because a government car scrapping bonus is believed to have undercut sales of other big-ticket items.

If consumption continues to improve in coming months, it could attenuate to some extent a contraction in Europe's biggest economy, which is in the midst of its worst recession since World War II.

"Consumer sentiment has edged slightly higher in the second quarter when compared to the first quarter, suggesting that private consumption will be up again though certainly not enough to offset the weakness from exports and investment," said Goldman Sachs economist Dirk Schumacher.

On an annual basis however, retail sales fell by 0.8 per cent, according to data compiled by the national statistics office from seven German states that account for roughly 76 per cent of all sales.

The figures do not include sales of automobiles and petrol (gasoline).

"Sales have been actually quite robust given that the car wreckage scheme has probably 'crowded out' spending power," Mr Schumacher said.

The latest index of German consumer confidence showed little change meanwhile, the GfK institute said, and has been essentially stable since March.