Germany Consumer Confidence


Germany: Consumers slightly less confident in December on worsening expectations for the German economy

November 27, 2015

In December, the mood among German consumers moderated for a fourth consecutive month, restrained by consumers’ worsening expectations on the economy because they are concerned that the current strong inflow of refugees might lead to a rise in unemployment. The forward-looking consumer confidence indicator published by the GfK Group inched down from November’s 9.4 points to 9.3 points in December, which was nevertheless slightly better than the 9.2 points that markets had expected. Consumer confidence has moderated in the past months since peaking at an over-13-year high in June.

In addition to the overall consumer confidence indicator, which estimates consumer sentiment in the coming month, the GfK elaborates on three sub-indicators, which refer to November. In November, households’ expectations for the overall economy continued to worsen: the index fell to the lowest level since January 2013 and rested in negative territory for a second consecutive month. GfK pointed out that households’ increasing fears about rising unemployment were the main driver of this deterioration, saying that, “consumers are expecting an increase in unemployment figures over the next few months. […] When asked about the specific reasons for the expected decline in the labor market, the majority of respondents were of the same opinion, with 69 percent of those assuming that unemployment figures will worsen in the next few months attributing this to the refugee crisis, and the steady high stream of asylum seekers.” Consumers’ income expectations fell compared to October, but still rested at a very high level. According to the GfK, this suggests that, “although consumers predict unemployment to rise, they still do not believe that they themselves will be affected by this, and are therefore not concerned about losing their jobs.” Finally, consumers’ willingness to buy rose slightly in November, following five months of decreases. In the GfK’s view, the fairly strong reading indicates that, the “propensity to consume is still very pronounced despite the economic uncertainty.”

FocusEconomics Consensus Forecast panelists expect private consumption to expand 1.9% in 2015, which is unchanged from last month’s estimate. For 2016, panelists see private consumption growing 1.7%, which is also unchanged from last month

Author: Teresa Kersting, Economist

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Germany Consumer Confidence Chart

Germany Consumer Confidence December 2015

Note: GfK Consumer Climate Index.
Source: The GfK Group.

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