Germany’s consumer confidence is set to slightly weaken in April, driven by some easing in households’ income expectations and the propensity to buy, after a buoyant start to the year.
The forward-looking consumer confidence index fell to 10.4 from a revised 10.7 in March, survey results from the GfK showed on Tuesday.
Economists had expected the reading to remain unchanged at March’s original 10.8.
The latest “GfK Consumer Climate MAXX” survey was carried out between March 1 to 15 among around 2,000 consumers.
The economic expectations index of the survey rose seven points to reach 11.2 in March. That was the first increase after five consecutive months of decline.
The income expectations index fell 4.1 points to reach 55.9 in March.
The propensity to buy index decreased 3.4 points to 50.2, which was the lowest reading in over two years. A reading lower than this was last measured in December 2016, when the score was 48.
The Nuremberg-based market research group GfK expects consumption to remain an important pillar of economic growth in Germany this year too, if the uncertainty caused by Brexit and the trade conflict does not worsen further.
Further, the GfK said any encroachment of the uncertainty on job market expectations should be avoided.
When workers start to doubt the safety of their jobs, they will also turn cautious regarding spending.
“In this case, the consumer climate would most certainly take a hit, and the 1.5 percent forecast at the start of the year would no longer be sustainable,” the GfK said.
The material has been provided by InstaForex Company – www.instaforex.com