Eurozone Retail Sales See First Rise in Two Years

Retail sales across the eurozone rose for the first time in over two years during August, as the single currency bloc emerges from its long and painful recession.

Markit's purchasing managers index (PMI) for the eurozone's retail sector lifted to a 28-month high of 50.3 in August after reports of rising activity across many, but not all, of the 17 member states.

Any reading above 50 signifies an expansion in activity, while a figure below represents contraction.

"The retail PMI has now risen for five months on the trot, the longest sequence of improvement since the first half of 2010," said Trevor Balchin, senior economist at Markit and author of the monthly report, which is compiled from surveys of retail sector purchasing managers.

"But the latest survey continued to highlight the gulf in performance between the German and Italian retail sectors."

Employment in the eurozone's retail sector also lifted during the month.

German consumers have benefited from rising incomes and employment in recent months, which has given a boost to the country's retail sector. This has helped to underpin the headline eurozone retail sales numbers.

Similarly, signs of an improving domestic economic situation in France may be behind retail sales in the country rising for two consecutive months.

However, Markit said Italy - the eurozone's third largest economy - was the "weak link" as GDP continues to contract and unemployment hovers at record highs.

During the second quarter, the eurozone area emerged from the longest recession in its history

According to the European Union's statistics office Eurostat, the 17-nation bloc's economy beat analysts' expectations and expanded by 0.3% in the three months to June this year.