"No signs" of a turnaround in the consumer climate
The downward trend in consumer sentiment in Germany has been halted just in time for the Christmas shopping season. According to GfK, the climate is brightening somewhat. However, the mood is still tense and characterized by worries. The experts are not hopeful.
After three consecutive declines, consumer sentiment brightened slightly at the end of the year, but remains at a low level. According to the market research company GfK and the Nuremberg Institute for Market Decisions (NIM), the consumer climate is expected to reach minus 27.8 points in December. This is 0.5 points more than in November, when the consumer climate reached a revised minus 28.3 points.
"The mood is still characterized by uncertainty and concern," explained NIM consumer expert Rolf Bürkl. "There are no signs of a sustainable recovery in the coming months." This uncertainty is particularly evident in the propensity to save, as recently revealed by an in-depth analysis carried out by the NIM.
Consumers were asked specifically why they currently consider saving to be advisable. In the open survey, just under a third of respondents stated that they were very unsettled by the current political and economic situation and therefore thought it made sense to keep their money together.
In addition to the current conflicts, such as the war in Ukraine or the conflict in the Middle East, high inflation in Germany plays a particularly important role in the tendency to save, explained GfK and NIM. This concern was mentioned by more than a third of respondents.
Inflation as a driver of uncertainty
"This empirically confirms that the propensity to save serves less as an indicator of conscious investment, but can primarily be interpreted as an indication of the extent of consumer uncertainty," explained Bürkl. "Conversely, however, this also means that a sustainable recovery in the consumer climate requires inflation to be brought back to a reasonable level and that solutions must be found to the international crisis hotspots."
The GfK consumer climate, which has been surveyed regularly since 1974 and monthly since 1980, is considered an important indicator of consumer behavior, which in turn is an important pillar of economic development in Germany. Since last month, the data collected by GfK has been analyzed and published jointly with the Nuremberg Institute for Market Decisions (NIM), founder of GfK.
For the current survey, around 2000 people were questioned from November 2 to 13. The consumer climate refers to total private consumer spending, i.e. services, travel, rent and health services in addition to retail.
Despite the slight improvement in consumer sentiment at the end of the year, there's no evidence of a lasting improvement in the consumer climate in Germany. The current consumer society in Germany continues to be characterized by uncertainty and concern, with inflation being a major contributor to this uncertainty. This highlights the role of consumption in Germany and its correlation with the overall economic climate, underscoring the importance of tackling inflation and international crisis hotspots to foster a sustainable recovery.
Source: www.ntv.de
