Germany: Consumer confidence surprisingly drops in December
November 26, 2012
The forward-looking GfK consumer confidence indicator for December fell to 5.9 points. The figure was down from both the revised 6.1 points recorded in November (previously reported: 6.3 points) and market expectations, which had the index at 6.2 points. The December result represents the first drop in the index since May, mainly reflecting consumers' less optimistic view about their income prospects. While the overall consumer climate indicator refers to December, GfK released detailed data for November. The economic expectations sub-index improved over the previous month, representing the third consecutive monthly gain. According to the GfK Institute, consumers were less fearful that the economy would enter into recession, "although economic signals are not particularly encouraging at the present". While economic expectations remained on its upward trend, income expectations fell sharply over the previous month and, consequently, consumers' willingness to buy lost some of the ground gained in the previous month.
Author: Ricardo Aceves, Senior Economist