German consumer confidence at highest since April 2022

29th May 2024 07:46

(Sharecast News) - Consumer confidence in Germany rose to its highest reading in more than two years, according to the latest Consumer Climate Indicator from GfK and the Nuremberg Institute for Market Decisions (NIM).

The headline index rose for the fourth straight month, with the indicator for June increasing to -20.9 points, from a revised -24.0 the month before.

This was the highest reading since April 2022 and ahead of the consensus forecast for a smaller improvement to -22.5.

The survey showed that Germans' assessment of the economic outlook increased significantly, with the sub-index rising from 0.7 to 9.8, while income expectations rose moderately to 12.5 from 10.7.

Consumers' propensity to save fell sharply to 5 from 14.9, while their propensity to buy increased slightly to -12.3 from -12.6.

"Falling inflation rates combined with significant wage and salary increases are strengthening consumer purchasing power. This has a stimulating effect on income expectations and also reduces consumer uncertainty, which was also reflected in the comparatively high propensity to save in previous months," said Rolf Bürkl, consumer expert at NIM.

"Nevertheless, it can be assumed that German consumers are still very uncertain. There is still a lack of clear future prospects in the country, which leads to little planning security when it comes to purchases. Only when people regain this security will they be willing to invest their increasing purchasing power in larger purchases again."