Thursday, February 25, 2021
GfK consumer confidence increased
Consumers process lockdown shock
The mood was better. But slowly, people in Germany are rediscovering their consumption pleasure. The GfK experts still see a hurdle that would have to be cleared so that the buying mood recovers over the long term.
Despite the fact that shops and restaurants remained closed, the mood of German consumers has brightened slightly. The Nuremberg-based GfK market researchers predict an increase in their consumer climate barometer by 2.6 to minus 12.9 points for March. Economists had only expected an improvement to minus 14.3 points.
"Consumers are recovering somewhat from the shock that hit them after the hard lockdown in mid-December," said GfK specialist Rolf Bürkl. "The recent drop in the number of infections and the vaccination campaigns that have started are fueling hopes that the measures will be relaxed soon." In the previous month, the buying mood fell to its lowest level since June 2020, when citizens had to put up with the consequences of the first lockdown due to the virus pandemic.
The willingness to make larger purchases – for furniture, computers or cars, for example – remains subdued. "There will only be a sustained recovery in the propensity to buy and thus also in the consumer climate when the hard lockdown is ended and shops, hotels and restaurants reopen," said Bürkl. "If, on the other hand, the measures are even extended again, the chances of a swift recovery will diminish and the consumer climate will continue to face difficult times."
However, consumers are looking more confidently about the economy again. The German economy grew by 0.3 percent in the final quarter of 2020 and thus more strongly than initially thought. However, according to economists, the ongoing lockdown is likely to slow down the gross domestic product again in early 2021. The Berlin DIW researchers assume that the economy will shrink by around 1.5 percent compared to the previous quarter.
With the hope of an end to the hard lockdown, the expectation that incomes will increase is also increasing, according to GfK. "Short-time work could be cut back and a number of bankruptcies could possibly also be prevented," said market researcher Bürkl. "This would reduce the fear of job loss."
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