The purchasing mood of German consumers has apparently deteriorated again recently. This emerges from the results of a current study published by the German Trade Association (HDE) on Monday. “The improvement in consumer sentiment in October remains an exception,” said the industry organization. “The HDE consumption barometer goes down again in November, the value is even weaker than in September.”
The monthly index, which is based on a survey of 1,600 people on consumption-related topics, fell again in November after the small upturn in the previous month – as it did during the summer months. The HDE was therefore not very optimistic ahead of the most important weeks of the year for many retail companies. “There is still a lack of impetus for a sustained improvement in consumer sentiment,” explained the association. “Overall, this points to a potentially complicated Christmas business.”
Consumers are skeptical about income development
The consumers surveyed recently assessed the prospects for the development of the overall economy as somewhat more positive than in October. However, they were more skeptical about their own income situation. “The pessimism here increased significantly again in November,” explained the authors of the study. The situation on the labor market “remains tense” and major financial relief from the state is “currently not planned by the federal government,” it said.
This had an impact on consumers’ current plans. “Consumers are planning with a potentially lower disposable income and are making adjustments to consumption and saving,” emphasized the HDE. Specifically, in November both the propensity to buy and the intention to invest savings were below the level of the previous month.
Hopes for an upswing have recently not been fulfilled
This downward trend comes just before the Christmas shopping season “at an inopportune time,” explained the association. The interim results for the current year were correspondingly sobering: “Expectations that a recovery would begin in the second half of the year following a subdued first half of the year have not been fulfilled,” said the HDE.
The industry organization is now pinning its hopes on a possible upward trend after the turn of the year. “Consumer optimism may return in the coming year if fiscal policy measures stimulate overall economic growth,” the association explained. “Then private consumption may also recover more strongly and support an economic upswing.”