The Eurozone’s retail sales soared 17.8 percent in May from April as consumers began to emerge from stringent lockdowns.
Clothing, electronics, and furniture were high on shopping lists, especially in France and Germany, where consumer spending rose to about 93 percent of pre-pandemic levels.
In previous economic reversals, business spending led recoveries. But European analysts are counting on consumers, who account for more than half of Europe’s economic activity, to spearhead this recovery because capital spending remains constrained by high corporate debt and months of lost sales.
Consumers are able to spend somewhat freely because of government schemes, such as those in France and Germany, that subsidize payrolls so millions of workers have continued to collect most of their salaries and be eligible for fringe benefits.
TRENDPOST: As we have continually noted, rises in sales are from pent up demand after being locked down and artificially propped up with government-subsidized recovery injections.
When the fake money dries up, the economies will go much further down.
