Inflation Unsettles German Consumer Confidence

28 May 2008

NURNBERG, Germany: Consumers in Europe's largest economy are beginning to feel the economic pinch as price rises take their toll.

Market research giant GfK's latest confidence index shows a decline to 4.9 in June from May's 5.6, itself lower than economists' expectations of 5.7.

German consumers are particularly unsettled by the high price of oil, according to GfK, in addition to "concerns about price stability and uncertainty resulting from the crisis on the financial markets and the flagging US economy".

The country's own economy is expected to cool after a solid first quarter, but GfK says: "A recession in Germany doesn't seem likely. The German economy still is in robust shape."

Data sourced from (Germany); additional content by WARC staff