German retail sales, excluding cars rose 0.4% in May, according to preliminary data today, which offered a rare ray of light for Europe's biggest economy.
Economists had forecast that sales would be flat compared to April. Compared to May 2008, sales were down 2.9%, when adjusted for inflation, the statistics office said.
Economists said that consumer spending in Germany, which this year is on course to suffer its worst recession since World War II, was being supported by government-payrolled schemes keeping a lid on unemployment.
Tame inflation and tax cuts under Chancellor Angela Merkel's €80 billion worth of stimulus packages were also helping, experts said.
Analysts also said that shoppers would also get a boost from a rise of pension payments of on average 2.5%, higher social security payments and lower health insurance contributions kicking in on July 1.
