German consumer sentiment set to worsen in September, reversing improvement

By Ed Frankl

Consumer confidence in Germany weakened in data for September, reversing August’s improvement, reflecting gloomier income expectations and prospects for the country’s economy.

Germany’s forward-looking consumer-sentiment index forecasts confidence to tick down to minus 25.5 in September, from a revised minus 24.6 in August, according to data from market-research group GfK published Tuesday.

The reading is a little weaker than expectations of minus 25.0, according to a consensus of economists polled by The Wall Street Journal.

The worsening consumer confidence follows a weaker reading of business sentiment from the closely watched Ifo business-climate indicator, which last week fell for the fourth month in a row.

GfK uses three sub-indexes for the current month–August–to derive a sentiment figure for the coming month. Two of them–falling income expectations and a declining propensity to buy–drove the overall figure downward, according to GfK consumer expert Rolf Buerkl.

The continuing sharp rise in food and energy prices is weighing on purchasing power, GfK said, with inflation in July still high at 6.2%.

The chances that consumer sentiment will recover from its low level before the end of the year are dwindling more and more, Buerkl said.

“Persistently high inflation rates, especially for food and energy supplies, ensure that the consumer sentiment is currently not making any progress,” he added.

Consumers are also much more pessimistic about economic development in Germany, the survey’s authors said, with the indicator measuring economic development also suffering in August, reaching its weakest point in 2023.

Overall, private consumption is unlikely to make a positive contribution to economic development in 2023, and will instead be a burden on growth prospects, GfK said.

Write to Ed Frankl at

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