Euro Retail Sales Down In June

BRUSSELS (AP) -- Retail sales in the 16 nations that use the euro fell 0.2 percent in June from a month earlier, showing that consumers are wary of spending as unemployment hits a 10-year high.

Despite falling prices in June, when inflation shrank by 0.1 percent from a year ago, and higher consumer confidence, shoppers are reluctant to spend. Unemployment rose to 9.4 percent the same month as companies cut back costs to match slowing demand for goods and services.

The EU statistical agency Eurostat on Wednesday also changed its figure for retail sales in May, saying they fell 0.5 percent, falling more sharply than the 0.4 percent it reported last month.

Germany, Europe's largest economy, saw sales contract 1.8 percent from May to June.

Shoppers cut back spending both on daily essentials such as food, drink and tobacco -- down 0.2 percent from May -- and on non-food items such as clothing, electronics and medicines -- also down 0.2 percent.

Euro-zone retail sale slumped by 2.4 percent in June from the same month last year.

Across the entire 27-nation European Union, retail trade increased 0.1 percent from May to June. Year-on-year, June retail sales in the EU fell 1.7 percent.

British retailers reported selling 1.3 percent more in June than a month earlier, Eurostat said. Britain was one of only four EU states to show sales rising over the year, up 1.8 percent.

Poorer eastern European nations that have been badly affected by the recession saw dramatic sales slumps in June from last year. Latvian retailers said sales fell 29.1 percent, Lithuania was down 19.9 percent and Romania fell 17.8 percent.

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