Germany: collapse in consumption. Stagflation begins to create the poverty desired by governments
Poverty is starting to bite hard even in Germany. Retail sales in Germany plummeted 5.4% month-over-month in April 2022, the largest decline in a year and far worse than the market's forecast of a 0.2% decline, due to the increase in costs, especially for foodstuffs, which weigh on consumer spending . Sales of food products recorded a record decline of 7.7% and sales of non-food products fell by 4.4%, in particular sales of textiles, clothing and footwear (-4.3%) and sales in department stores (-7%). Purchases at service stations also decreased. On the other hand, online and mail order sales increased by 5.4%. Compared to the same month last year, retail sales fell by 0.4%. Here is the relative graph
If we examine everything in a five-year perspective we see that, apart from the fluctuations of the covid period, there has never been a similar trend since 2018.
in the covid period, lockdowns were driving the decline in sales: people did not leave their homes, so they did not buy, but saved and spent in their moments of freedom. Today this is not the case: people go out freely, but the inflation due to the boom in energy prices has eaten up a considerable portion of the income and therefore has led to the compression of all other consumption, and therefore to the fall in retail sales.
The growth in energy prices, the basis of imported inflation, is only partially due to external factors: the reduction in investments in hydrocarbons due to the Green Deal and "Fit for 55" regulations has led to the increase in prices which now, late, we try to reduce. Too late: if the Commission really wanted to decarbonise, it should have first offered alternative sources and then decarbonised. German citizens in the first place, and Europeans in general, are paying the price with their poverty.
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The article Germany: collapse of consumption. The stagflation begins to create the poverty desired by governments comes from ScenariEconomici.it .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/germania-crollo-dei-consumi-la-stagflazione-inizia-a-creare-la-poverta-desiderata-dai-governi/ on Wed, 01 Jun 2022 11:58:50 +0000.