BERLIN, Dec 1 Reuters German retail sales fell morethanexpected in October, data showed on Thursday, as inflation had consumers holding back on nonessential purchases at the start of the fourth quarter.

Retail sales were down 2.8 on the month in October, a further drop than the 0.6 dip in priceadjusted terms expected by analysts polled by Reuters.

Compared with October 2021, retail sales were down 5.0.

The retail sales figures for October give rise to the suspicion that the fourth quarter indeed marks the muchcited beginning of the winter recession, said VP Bank chief economist Thomas Gitzel, who added that the 4.5 monthonmonth drop in nonfood retail in October showed consumers were forgoing nonessential items in the face of high inflation rates.

Germany39;s HDE retail association is forecasting the strongest slump in Christmas sales since 2007, with retail sales in the crucial NovemberDecember period seen dropping by 4 yearonyear on a priceadjusted basis.

The German economy grew by 0.4 quarteronquarter in the third quarter on the back of consumer spending, despite rising inflation rates that hit the double digits in September.

Writing by Miranda Murray Editing by Paul Carrel

Source Reuters