Germany's unemployment rate held at a 20-year low in June, pointing to a still buoyant labour market, but consumers spent cautiously in May, in part due to an E.coli outbreak that led to a drop in food sales.
Germany has recovered swiftly from its deepest post-war recession, outpacing euro zone peers. Stronger exports have been matched in recent months by higher domestic consumption, a picture clouded slightly by today's data.
The adjusted jobless rate was 7 per cent, seasonally adjusted Federal Labour Office figures showed, its lowest level since German reunification in 1991.
That was unchanged from May, when retail sales however fell at their fastest rate in four years, according to earlier statistics office data.
Economists said an E.coli outbreak that led to a drop in food sales was partly responsible for the 2.8 per cent monthly dip, though sales stripping out food also fell.
Germany posted 1.5 per cent economic growth in the first quarter of this year. Low unemployment has tracked the rebound, prompting politicians to talk of a "job miracle" though both Berlin and the Bundesbank say the pace of growth is easing.
Unemployment fell by a further 8,000 in June.
Supermarket chain Edeka said the blip should be temporary, saying shoppers had returned to buying fresh fruit and vegetables since the E.coli crisis peaked.
Germany's overall economic prospects remain buoyant, and any slowdown in consumption has done little to slow the pace of inflation.
Munich-based think tank Ifo yesterday hiked its forecast for German growth to 3.3 per cent this year and 2.3 percent in 2012.
Consumer inflation held above the European Central Bank's target level at 2.3 per cent in June, unchanged from May.
Reuters
