German Consumer Confidence To Worsen In February
January 25 2024 - 9:57PM
RTTF2
Germany's consumer confidence is set to fall in February as
persistently high inflation damped income expectations and the
propensity to buy amid falling economic expectations.
The forward-looking consumer sentiment index unexpectedly fell
to -29.7 in February from revised -25.4 in January, the survey
published jointly by GfK and the Nuremberg Institute for Market
Decisions showed Friday.
The indicator hit the weakest level since March 2023, while
economists forecast the score to rise to -24.5.
The improvement in confidence seen in the previous month was
apparently just a brief flare-up before Christmas, Rolf Burkl, a
consumer expert at NIM said. But hopes of the recovery were dashed
in January.
The propensity to save advanced 6.7 points to 14 in January,
which was the highest value since August 2008.
Income prospects of consumers continued its downward trend on
higher inflation. The return of the regular Value Added Tax rate of
19 percent in the catering industry as well as the rise in the CO2
tax for energy will further weaken expectations, the survey
showed.
The income expectations indicator declined by 13.1 points to -20
in January, the lowest since March 2023.
Weak income expectations again lowered consumers' propensity to
buy. The propensity to buy index dropped to -14.8 from -8.8.
Economic outlook for the coming year were also assessed more
pessimistically. At -6.6, the index lost 6.2 points. A lower value
was last reported in December 2022.
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