Consumer sentiment in Germany has slightly improved by the end of the year. This is the result of the so-called GfK consumption climate, which was published on Thursday.
Both income expectations and the willingness to make purchases have increased in December, at the same time as savings intentions have decreased. As a result, the consumption climate is expected to rise slightly in the forecast for the start of the new year. For January 2025, an increase of 1.8 points is forecast compared to the previous month, revised to -23.1 points, with a predicted value of -21.3 points.
Besides a positive development of income expectations and the willingness to make purchases, the slight improvement in the consumption climate is also due to a decreasing savings intention. This has decreased by six points compared to the previous month and currently stands at 5.9 points.
“After the decline in the previous month, the consumption mood has improved slightly, but can only partially compensate for the previous setbacks” said Rolf Bürkl, a consumption expert at the NIM, which is involved in the study. The consumption climate still shows a very low level with -21.3 points. “Looking back, we have seen at best a stagnant development since mid-2024.”
“A sustainable recovery of the consumption climate is still not in sight, as consumer uncertainty is still too great” the expert said. “The main reason is the high prices of food and energy. Moreover, concerns about job security are growing in many areas.”
After four consecutive declines, consumer expectations of the economy stabilize by the end of the year. The indicator gains 3.9 points and thus compensates for the losses of the previous month. Currently, it stands at 0.3 points, which is roughly at the same level as the previous year.
After the strong decline in the previous month, income expectations have recovered a bit in December. However, the strong losses of over 17 points in November are only partially compensated, with a gain of 4.9 points. The income indicator currently stands at 1.4 points.
The willingness to make purchases also continues its stable development at the end of the year. The indicator gains 0.6 points and now stands at -5.4 points, thus compensating for the losses of the previous month to a certain extent. In comparison to the corresponding period of the previous year, a plus of about three points can be recorded.
The survey period for the current analysis was from December 5 to 16. The results are based on around 2,000 consumer surveys, which are conducted monthly on behalf of the EU Commission.