Gfk Survey Reveals Low Consumer Sentiment

last updated on

Gfk Survey Reveals Low Consumer Sentiment

Gfk Survey Reveals Low Level Of Consumer Sentiment In Germany

The latest survey shows that consumer sentiment in Germany has likely stabilized at a low level in March. The survey also revealed that consumers face much uncertainty due to rising prices (inflation) and a weak economic outlook.

Famous firms such as the GfK and the NIM published the consumer sentiment index. The data showed a reading change from -29.6 to around -29.0 in March, an improvement.

Consumer Sentiment Recorded At -29.0

Despite the slight improvement, the consumers are still facing uncertainty. After all, the German economy faces multiple headwinds in the form of inflation, weak growth forecasts, & and a decline in exports.

Given the circumstances, the government of Germany has already lowered the 2024's growth outlook from 1.3% to around 0.2%. Given that we are only two months into 2024, there's no telling that the number might even change into negative.

That's why experts believe that the only good thing that can happen to Germany is an economic recovery. However, consumer spending still needs to improve, which makes it even more difficult.

With the Ukraine conflict and the higher inflation levels, consumers are still willing to spend money despite the slight increase in income expectations during February.

If we look at the reading itself, a negative number is a sign of a decline compared to last year. According to GfK, the reading shows a +0.1% change in private consumption.

Amidst all this, the one factor that could flip things around for Germany is rate cuts from the ECB. German firms will rejoice in a lower interest rate, boosting consumer demand across the EU region.

However, it will still be too soon to tie Germany's recovery with rate cuts as the ECB has yet to give any definite timeframe.

Trending Stories