Germany's retail sector is expected to record a 2% increase in revenue in 2026, according to projections released by the industry association HDE on Monday. Once inflation is taken into account, that growth estimate falls to 0.5% - signalling only marginal real expansion for retailers operating in Europe's largest economy.
The forecast marks a moderation following stronger reported sales in 2025. Official figures published the same day showed retail sales climbed by 3.8% last year in nominal terms, which amounts to 2.7% after adjusting for inflation.
HDE commentary and context
HDE executive Stefan Genth framed the near-term picture as muted, saying: "The new year is starting without any real momentum for the retail sector." In his remarks he pointed to geopolitical uncertainties and what he described as an "erratic" U.S. President as elements that are weighing on the industry's outlook.
What the numbers mean
The contrast between nominal and real growth in the HDE projection highlights the erosion of purchasing power from inflation. While a 2% nominal gain signals higher topline receipts for retailers, the much smaller 0.5% real increase indicates that much of that gain will be absorbed by higher prices rather than additional volume or real-term revenue expansion.
Industry implications
The HDE forecast suggests that, absent a change in macroeconomic momentum, retailers should expect only modest improvements in revenue on a real basis next year. The association's statement also underscores how non-economic factors cited by its executive - geopolitical uncertainty and political volatility abroad - are informing the sector's risk assessment.
Official 2025 data included in the release provide a recent reference point: retail sales expanded by 3.8% nominally in 2025, equivalent to 2.7% in real terms.
Outlook
Given the association's assessment and the inflation-adjusted projection, the retail sector looks set for limited real growth in 2026, with the external risks flagged by HDE likely to shape merchant caution and strategic planning into the new year.