After a setback in April, the mood of German consumers is picking up again slightly in the current month. This is the result of the latest survey results published by the German Retail Association (HDE) on Tuesday. “After the recovery in consumer sentiment recently faltered, it picked up again slightly in May,” the industry organization said in a statement. “Consumers are increasingly optimistic about the future.”
The association referred to the results of the current HDE consumption barometer for May. The monthly index, which is based on a survey of 1,600 people on consumption-related topics, recorded a slight increase compared to the previous month.
Many consumers currently prefer to save rather than consume
The authors of the study attributed the upward trend to the fact that those surveyed were more optimistic about the overall economic development and their own income prospects than in April. “Consumers are assuming a positive economic development, similar to companies and the Federal Ministry of Economics,” they explained. However, the economic expectations remained “significantly below previous highs”.
However, the increased confidence has not yet provided any impetus for the propensity to buy. The market researchers conceded that the mood to buy “is not yet gaining momentum in May”. Instead of higher consumer spending, those surveyed are currently planning to invest more in savings.
In view of this trend, the experts believe that the recent improvement in sentiment is unlikely to contribute to an improvement in the overall economic situation for the time being. It is “to be expected that consumers’ purchasing decisions will be characterized by restraint in the coming months,” they explained. “Private consumption would then cease to be a relevant driver of an economic recovery.”