Downward trend intensifies in October: trade association sees consumer sentiment in a “steep descent”

According to the findings of the German Retail Association (HDE), the mood of German consumers to buy has continued to deteriorate. The mood is in a “steep descent,” said the industry organization on Tuesday, citing the results of the current HDE consumption barometer for October.

The monthly index, which is based on a survey of 1,600 representatively selected people on consumption-related topics, has fallen for the third month in a row and has “reached an all-time low”, the HDE explained. A downward trend can be observed, which after the slowdown in the summer is now gaining momentum in the autumn months. The association cited “rising living costs and high energy costs” as the main reasons.

The HDE does not anticipate a positive trend reversal in the coming months

The HDE failed to raise hopes of an improvement in the near future. “Real private consumption is expected to fall until spring 2023, so that it should also be below the pre-corona level next year,” the industry organization said in a statement.

All sub-indicators that make up the consumption barometer have recently continued to fall. In view of the most recent development and the pessimistic forecasts of the research institutes, the general economic expectations of those surveyed fell to a new historic low. At the same time, individual income expectations continued to fall. “The rising cost of living reduces the disposable income of consumers, so that further scope for consumption and saving is reduced,” explained the authors of the study.

The current values ​​for the propensity to buy and save also deteriorated accordingly. The market researchers see the prospects for the retail sector shortly before the all-important Christmas trade as rather gloomy: “As a result of this development, consumer restraint is likely to increase further in the coming weeks – at least according to the announced plans of consumers,” they explained.

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