Germany’s consumer confidence is set to weaken sharply in September amid deterioration in economic expectations and the propensity to buy as well as an inclination to save, survey data showed Thursday.
The forward-looking consumer confidence indicator dropped to -1.2 from a revised -0.4 in August, the market-research group GfK said. Economists had expected the index to fall to -0.7.
The economic expectations indicator fell for a second straight month, but remained at a high level. The reading dropped to 40.8 from 54.6.
The propensity-to-buy index eased to 10.3 from 14.8 in the previous month. Carefree shopping is still not a reality in light of mandatory mask use and distance rules as well as stronger rise in prices, the GfK said.
The income expectations index edged up to 30.5 from 29.0 in the previous month, thanks to stable employment figures and the associated low fear of unemployment.
“Significant higher incidence values, a slowdown in vaccination momentum, and discussions about how to deal with unvaccinated individuals in the future have caused noticeable uncertainty among consumers in Germany,” Rolf Burkl, a GfK consumer expert, said.
The fear that restrictions could even be tightened again is obviously depressing consumer sentiment right now, Burkl added.
Rising inflationary pressures are also dampening consumer sentiment.
“While these are primarily one-off effects stemming from the VAT cut in the second half of 2020, given the ongoing low-interest phase, households perceive inflation rates as even more threatening to their purchasing power,” Burkl said.
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