Euro-Zone January retail sales rose 0.1% m/m, marginally lower than our forecast and median of 0.2% m/m, but with December data revised down to -0.3% m/m, from 0.0% reported initially. Sales were down 1.0% in the three months to January, a slight improvement from the -1.1% in the three months to December, but data still highlight that consumption remains subdued as consumers are concerned about the state of the overall economy and unemployment continues to rise. Sales were down 2.2% y/y, after falling 2.4% y/y in December. Data support expectations for a weak Q1 GDP number and subsequently back the ECB's decision to cut rates to record lows at the March meeting.
