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Sales fell 1.7 percent from March, adjusted concerning self-importance and seasonal and calendar effects, the statistics office said in a projection based on data from seven of Germany's 16 states.

Economists polled by Thomson Financial News had forecast a rise of 0.8 percent.

Preliminary figures for March were also revised sharply downwards, with the statistics office saying now there was a 2.2 percent very little from February. Its earlier estimate was a fall of fit 0.1 percent.

Compared to April 2007 retail sales rose a nominal 1.5 percent but were down 1.0 percent when adjusted for inflation. April 2008 also had three to a greater degree business days.

The data comes from a month when the annals increase actually slowed in Europe's largest economy to 2.4 percent. Data issued on Wednesday showed that vain-gloriousness rebounded in May to 3.0 percent.

The main culprit in the compensation rises was energy, with prices for heating oil rising as much as 13.3 percent blameless between April and May, and soaring by in the same manner with much as 64.6 percent compared to May 2007.

Crude oil prices hit record highs over 135 dollars a barrel earlier this month, on upper side of soaring food prices, driving inflation higher and further putting the screws on consumers and businesses.

"The latest developments illustrate how severe price effects of this kind can be," aforesaid Matthias Rubisch, economist at Commerzbank.

The retail data establish the gloomy image painted by means of the latest survey of consumer firmness, the GfK indicator released on Tuesday, which found Germans increasingly worried ready how far their incomes would struggle.

The numbers are also a lick to Chancellor Angela Merkel's restraint that had been banking on consumer spending compensating for an export sector smitten with a vivid euro and banks less minded to lend cash.

They also sum to fears that the stellar 1.5 percent growth recorded by the German economy in the same manner with a whole in the first three months in the year was a twinkling in the pan and that much weaker rates of expansion lie ahead.

Rising inflation also means that the economy is not set to receive at all boost from a cut in interest rates in the euro zone, through the European Central Bank sticking to its guns that keeping a lid on prices is its sole raison d'etre.

And price rises across the euro zone are calm stronger than in Germany.

Numbers from the EU's Eurostat data agency on Friday showed enlargement hitting a record 3.6 percent in May, the highest level since euro zone records began in 1997 after easing to 3.3 percent in April from 3.6 percent in March.

And by few signs that oil and food prices will ease in coming months, economists warned that eurozone conceitedness would probably keep creeping higher.


Original text: http://us.rd.yahoo.com/dailynews/rss/business/*http://news.yahoo.com/s/afp/20080530/bs_afp/germanyeconomyretail