Germany’s retail sales dropped 2.0% month-over-month in March 2026, significantly missing market expectations for a milder 0.1% decline and deepening from a downwardly revised 0.3% fall in the previous month. This marked the third consecutive monthly contraction and the sharpest decrease since October 2022, as heightened uncertainty linked to the Middle East conflict weighed on consumer sentiment and spending. Food sales led the downturn, falling 2.7%, while non-food sales slipped 1.0%. In contrast, online and mail-order trade showed resilience, rising 3.0%. On an annual basis, retail sales also fell 2.0%, swinging from an upwardly revised 0.9% increase in February and undershooting forecasts for a 0.5% gain.