Germany GfK Consumer Climate

The GfK consumer sentiment indicator for Germany unexpectedly was at 9.7 heading into December of 2019, compared with market consensus and the previous month's three-year low of 9.6. Both economic and income expectations increased markedly, while the propensity to buy remained at a high level. The gauge measuring economic expectations jumped 15.5 points to 1.7, slightly above its long term average of zero, as Germans were more optimistic about the growth outlook due to tentative signs of easing in the trade row between the US and China. Also, the indicator measuring income expectations sub-index gained 6.5 points to 45.5, amid robust labor market, rising wages and moderate inflation. Meanwhile, the willingness to buy fell 1.7 points but remained at a high level of 50.

The GfK consumer sentiment indicator for Germany dropped to 9.6 heading into November 2019 from a downwardly revised 9.8 in the previous month and missing market consensus of 9.8. This was the lowest reading since November 2016, amid concerns over global economic downturn, trade conflicts, Brexit chaos and rising fears of job losses, particularly in the automotive industry. The gauge measuring income expectations sub-index slumped 7.8 points to the lowest in near six years of 39.0 and the economic expectations declined 4.8 points to the lowest since December 2012 of -13.8. In addition, the indicator measuring consumer's willingness to buy fell 3.4 points to 51.7. “Optimism is dwindling,” GfK researcher Rolf Buerkl said in a statement. “Nevertheless, private consumption will remain an important pillar for the economy.”

The GfK consumer sentiment indicator for Germany rose unexpectedly to 9.9 heading into October 2019, beating market consensus of 9.7. This was the highest reading since June, following the ECB's latest decision to further relax its monetary policy while concerns about the ongoing trade conflict and the prospect of a no-deal Brexit continued to weigh. The gauge measuring economic expectations increased by 3 points to -9, and the indicator measuring consumer's willingness to buy climbed 6.3 points to 55.1. Meanwhile, the income expectations sub-index fell 3.3 points to 46.8. "The ECB decision has on one hand resulted in an increase in propensity to buy, and on the other resulted in propensity to save reaching its lowest level since April 2016," Rolf Buerkl, a researcher for Nuremberg-based GfK, said in a statement. "It will become clear in the coming months whether this is sustainable," he said, adding that positive consumer sentiment will depend on the stability of the labour market.

The GfK consumer sentiment indicator for Germany stood at 9.7 heading into September 2019, unchanged from the previous month's two-year low and compared to market expectations of 9.6. The gauge measuring economic expectations fell to -12, the lowest level since January 2013, amid concerns over global economic downturn, ongoing trade tensions and the prospect of a no-deal Brexit. Also, the income expectations sub-index slipped 0.7 points to 50.1, while the indicator measuring consumer's willingness to buy rose 2.5 points to 48.8.

The GfK consumer sentiment indicator for Germany slipped to 9.7 heading into August 2019 from 9.8 in July and in line with market expectations. This was the weakest reading since April 2017, as the gauge measuring economic expectations fell to -3.7, the lowest level since November 2015, with concerns over global economic downturn, ongoing trade conflicts and Brexit uncertainty fueling workers fears of a recession. Also, the indicator measuring consumer's willingness to buy dropped to a near four-year low of 46.3 from 53.7 in July; while the income expectations sub-index rose to 50.8 from 45.5, suggesting consumers still count on further pay increases in coming months.

The GfK consumer sentiment indicator for Germany dropped to 9.8 heading into July 2019 from 10.1 in June, below market estimates of 10. It was the weakest reading since April 2017, as the gauge measuring income expectations fell sharply to its lowest in over two years amid fears concerning job losses, namely in the automotive industry. The income expectations sub-index tumbled 12.2 points to 45.5, the lowest since March 2017 when it stood at 41.6. Conversely, the economic expectations sub-index edged up 0.7 points to 2.4, stabilizing at a relatively low level on the back of government's decision to revise lower its 2019 GDP growth forecast to 0.5 percent, due to global economic cooling off, on-going discussions around Brexit, and the trade war with the US. Also, the gauge measuring consumers' willingness to buy gained 3.2 points to 53.7.