A closely watched measure of household confidence, German retail sales rose by 1.9 percent in October month-on-month, the Federal Statisitcal Office (Destatis) reported Friday.

On a 12-month basis, business increased by 1.7 percent. The rebound was stronger than most analysts had expected, following a 2.8 percent decline in sales in September.

Statisticians said the pickup in October was primarily due to stronger sales of food items, beverages and tobacco plus books and jewelry, while clothing and shoes didn't sell well because of a protracted spell of warm weather in the country.

Rosy outlook

In the first 10 months of 2014, retail sales rose by 1.3 percent, Destatis said.

Retailers are now looking ahead to what they believe will be a very lucrative pre-Christmas business.

The HDE business association had said it expected a record 85.5 billion euros ($106.3 billion) in seasonal income, a 1.2 percent improvement over 2013 levels. The organization also said people seemed willing to spend more money on big-ticket items as the domestic labor market remained robust and many people had more in their pockets because of recent pay hikes in many industries.

hg/cjc (Reuters, AFP, dpa)