The mood of German consumers has deteriorated further. This emerges from the results of a current survey published by the German Trade Association (HDE) on Tuesday.
Consumer sentiment is “currently on the decline,” explained the industry organization, citing the HDE consumer barometer for April. The monthly index, which is based on surveys of 1,600 people on consumption-related topics, fell again compared to the previous month of March. Now “further economic and geopolitical developments” will decide whether “consumer sentiment can recover in the foreseeable future or not,” it said in a statement.
According to the association, the respondents’ expectations regarding economic development in particular were more pessimistic than last month. A key reason is the now noticeable effects of the Iran war. As a result, consumers also assessed the expected development of their own income situation more negatively than before.
The trade association expects an “economically challenging year”
Due to the current uncertainties, those surveyed are now planning to invest more savings. At the same time, the propensity to buy also increased. The HDE emphasized that this is a “positive ray of hope” in the current gloomy overall situation.
However, the overall conclusion of the industry organization was sobering. “The sharp decline in consumer sentiment is an indicator of another economically challenging year,” explained the association. “The possible increase in VAT currently being discussed as well as the ongoing uncertain geopolitical situation also have a negative impact on consumer sentiment.” Against this background, “private consumption and overall economic growth are not expected to strengthen in the coming weeks and months,” said the HDE.
