BERLIN: Consumer confidence has reached the highest level for five years in Germany, according to GfK, the research firm.
The company polled roughly 2,000 people in the country, and reported that the forward-looking barometer of popular sentiment for November came in at 6.3 points.
This would constitute an improvement from the 6.1 points posted in October, and also represents the strongest result since 2007.
"The fear of a recession did not increase further among consumers in Germany during fall this year. For the second time in a row, the economic indicator is slightly up and has stabilized at a low level," the study said.
When discussing economic expectations, the panel returned a reading of –15.8 points, a lift of 1.4 points month on month.
"Economic sentiment has therefore stabilized at a low level. In summer this year, fear of a recession was widespread, but it is now diminishing," the study said.
Income perceptions also climbed by six points on a monthly basis to 29.9 points. While this score remains six points behind that recorded 12 months ago, it is still "extremely strong", GfK said.
Elsewhere, consumers' willingness to buy rose by 0.8 points to 33.9 points. This index has stayed consistently in the 30 to 40-point range for the last two years, representing impressive stability.
"The reasons for the remarkably steady trend in the willingness to buy are unchanged," the study said. "Stable labour market figures, a positive overall trend in wages and salaries and modest inflation bolster the indicator decisively."
Upon assessing the broader situation, GfK suggested shoppers would have a vital role in determining Germany's fiscal fortunes, given the challenging international trading environment.
"Consumption will play an increasingly important role for the further economic development in Germany. The weaker global economy is set to affect German exports. Accordingly, brisk consumption will be necessary to prevent Germany from sliding into recession," the study said.
Data sourced from GfK; additional content by Warc staff