Euro-zone Feb. retail sales plunge 4% year-on-year

Discussion in 'Economics' started by ASusilovic, Apr 6, 2009.

  1. LONDON (MarketWatch) -- Retail sales volume across the euro zone fell 0.6% in February, for a 4% decline from the same month last year, the statistics agency Eurostat reported Monday. Economists had forecast a 0.4% monthly fall and a 2.5% year-on-year decline. Meanwhile, inflation pressures continued to ease at the wholesale level. Eurostat said February producer prices fell 0.5% from January and 1.8% compared to February 2008. Economists had forecast a 0.4% monthly decline and a 1.6% year-on-year drop.

    http://www.marketwatch.com/news/sto...11-40B6-436F-BB4A-03016886C9AC}&dist=hplatest
     
  2. And yet Euro/$ still trades at 1.35. Something isn't adding up.
     
  3. That's the problem with competitive devaluation...
     
  4. The problem is structural.
    In EU retail distribution cost (and retailers' margin) are higher than US. The same item you buy in US for 1 US$, in EU you buy for 1.25 EUR, when you're lucky.

    When I was in US I found a lot of excellent italian items at a price lower than in Italy.

    You cannot only look at macroeconomic variables when people decide using microeconomic knowledge (and a lot of biased perceptions). IMHO, of course.