German Consumer Sentiment to Rise to Three-Year High, GfK Says
German consumer confidence will rise to its highest level in more than three years in December as lower unemployment and an improving economic outlook boost income expectations, GfK AG said.
The Nuremburg-based market research company said today that its consumer sentiment index, based on a survey of about 2,000 people, will increase to 5.5, the highest since October 2007, from a revised 5.1 in November. Economists forecast a gain to 5.1 in December from an initial November reading of 4.9, according to the median of 24 estimates in a Bloomberg News survey.
Household spending is putting Germany’s economy on a firmer footing as global demand for its exports starts to slacken. While the pace of economic expansion slowed to 0.7 percent in the third quarter from a record 2.3 percent in the second, private consumption was one of the main growth contributors, the Federal Statistics Office said today.
“Domestic demand is becoming a more and more dependable pillar for the economy,” GfK said in a statement. “Consumers believe that the German economy will continue to recover strongly over the coming months.”
GfK’s measure of households’ economic expectations rose for the sixth month to 65.8 in November from 56 in October. A gauge of income expectations increased to 44.9 from 36, and an index of consumers’ willingness to spend climbed to 39.3 from 22.5.
“The recovery is broadening,” said Carsten Brzeski, an economist at ING Group in Brussels. “Now all the Germans have to go out there and do a lot of Christmas shopping to keep it going.”
To contact the reporter on this story: Jeff Black in Frankfurt jblack25@bloomberg.net
To contact the editor responsible for this story: John Fraher at jfraher@bloomberg.net
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