Consumer morale robust in Germany

27 November 2012

BERLIN: Consumer confidence levels remain comparatively robust in Germany, meaning shoppers are also generally willing to make major purchases.

GfK, the research firm, polled 2,000 people, and found its forward-looking indicator of popular sentiment came in at 5.9 points for December, measured against 6.1 points in November.

"Despite this slight decrease, the level is satisfactory," GfK said. "Private consumption is continuing to fulfil its role of being a key pillar for the German economy."

When discussing economic expectations, however, scores actually improved in November, jumping by 1.2 points, albeit to a pessimistic –14.6 points overall.

"Although economic signals are not particularly encouraging at present, Germans are not becoming more fearful of recession," GfK said.

Upon assessing their personal income levels, respondents posted returns of 17.8 points, down by 12.8 points on a monthly basis, but still beating the long-term average, the study added.

"Germans continue to think that their income will soon rise," GfK said. "As inflation will not go up substantially in the coming months, a considerable proportion of the working population will enjoy increases in real terms.

"Nonetheless, it is essential that the labour market remains stable for this good development to occur. In this respect, forecasts are extremely encouraging."

Moreover, the willingness to buy index is also "very high". As such, even though the value of this index fell by 4.5 points in November, the reading of 29.4 points represents a largely favourable position.

"This great stability is above all due to the positive labour market figures. High employment curbs fears of job losses and therefore inspires planning security, especially when it comes to making larger, more expensive purchases," the analysis said.

Data sourced from GfK; additional content by Warc staff