German Consumer Confidence To Hold Steady In December
28 November 2017 - 09:48AM
RTTF2
German consumer confidence is set to remain unchanged at the end
of the year, underpinned by strong economic expectations, while it
is yet to be known whether the failed coalition talks would hurt
the sentiment, results of the latest survey by GfK showed
Tuesday.
The forward-looking consumer confidence indicator showed a
reading of 10.7 for December, unchanged from November, the
Nuremberg-based market research group said. The score was in line
with economists' expectations.
"This is good news, particularly given the upcoming Christmas
trade," the GfK said.
The economic expectations index rose to 44.3 in November from
43.5 in October. Consumers were also joined by companies and
economic experts in having an optimistic economic outlook, as they
expect growth of around 2 percent this year.
GfK attributed the strong momentum to the fact that the upturn
is currently based on very broad foundations because consumption,
increased investment and exports all contribute to good GDP
growth.
The income expectations measure eased to 47.9 from 48.7. Yet,
the indicator remains at a high level, thanks to the excellent
labor market situation and moderate inflation in Germany.
The propensity to buy index also fell in November, to 58.5 from
59.2.
The GfK has predicted at least 1.5 percent growth in private
consumption this year versus the official growth figure of 2
percent for 2016.
The failed exploratory talks, led by Chancellor Angela Merkel,
about forming a so-called Jamaica coalition have not been taken
into consideration in this data, because the survey had already
been completed at that time, the GfK said.
If further attempts to form a stable government become
deadlocked, it may increase uncertainty among consumers as well as
companies, the firm warned. In this case, there would be a risk to
the current, good consumer mood, it added.
The GfK also said that there was a continued threat of further
risks to the German consumer climate from abroad from events such
as faltering Brexit talks, North Korea tensions and possible
protectionist tendencies in the U.S. trade policy.
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