"The harsh and long winter hurt Germany's labour market, but the increase in unemployment by 13,000 in March will probably remain a temporary blip"
- Christian Schulz, senior economist at Berenberg Bank
Retail sales in the Europe's largest economy unexpectedly rose for a second month in February, adding to signs the domestic economy is returning to growth. A report by the Federal Statistics Office showed that German retail sales gained 0.4% from January, when they surged a revised 3.0%. On a yearly basis, sales, however, tumbled 2.2%, partly because there were less shopping days in February than in the same month a year earlier.
In a separate report, the Federal Labour Agency said that the number of unemployed people in Germany rose surprisingly this month, as renewed tensions in financial markets increased concerns the euro region's recovery will falter. The number of people out of work in Germany surged by 13,000 to 2.94 million, above analysts' expectations which called for a 2,000 decline. Still, the labour market boosted consumption, with a second increase in a row for retail sales last month supporting the Bundesbank's forecast that the economy will return to growth in the first quarter of 2013.
"The harsh and long winter hurt Germany's labour market, but the increase in unemployment by 13,000 in March will probably remain a temporary blip," said Christian Schulz, senior economist at Berenberg Bank in London. "The job market may not be quite as buoyant as in the last couple of years but it remains very healthy."
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