The German Retail Association (HDE) does not expect an upturn in the coming weeks for the industry, which has already been badly shaken by the effects of the Covid 19 pandemic. “Corona is still leaving deep marks on consumer sentiment,” said the organization on Monday, citing the current HDE consumption barometer for January.
The monthly index, which is based on a survey of 1,600 people on consumption-related topics, “fell further in January compared to the previous month and is almost at the low level of the previous month,” the association said. In view of the ongoing negative trend, “no major growth impulses for private consumption are expected in the first quarter of 2022”.
According to the HDE, the participants in the survey were more pessimistic than in December due to the current infection situation with regard to the general economic development. The respondents had “surprisingly” assessed their own income prospects somewhat more confidently than in the previous month. Apparently, the current labor market development justifies “no additional worries about the job”, explained the study authors: inside.
Consumers want to spend less and save more
However, the improved income expectations did not have a positive effect on the buying mood: the propensity to buy also fell in January – and could even be further dampened. “Should public life – beyond the contact restrictions that came into force after Christmas – be restricted, consumer reluctance to consume could increase even further, with the consequence of a greater shift in consumption and increased savings efforts,” warned the trade association. According to the latest survey, the propensity to save among consumers had already risen in January.
The rapid spread of the Omikron variant of the coronavirus had already increasingly influenced shopping behavior in the past few weeks: According to a survey by the market research institute Mintel, consumer concern about the risk of infection with the coronavirus increased significantly again in the weeks before Christmas. Accordingly, more than a third of those surveyed tried “to spend less time in stores,” said Mintel.
In view of the latest developments, the medium-term forecast of the trade association was sobering: “For February, the HDE consumption barometer must be expected to deteriorate further, as the consumers surveyed do not yet fully understand the latest developments and the latest measures to contain the infection in their answers could take into account, ”explained the HDE.