Propensity to save still high
“No signals” of a trend reversal in the consumer climate
November 28, 2023, 8:55 a.m
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The downward trend in consumer sentiment in Germany has stopped just in time for the Christmas season. According to GfK, the climate is brightening somewhat. However, the mood remains tense and worried. The experts don’t give you hope.
After three consecutive declines, consumer sentiment improved slightly at the end of the year, but remains at a low level. As the market research company GfK and the Nuremberg Institute for Market Decisions (NIM) announced, a value of minus 27.8 points is expected for the consumer climate in December. That is 0.5 points more than in November, when the revised consumer climate reached minus 28.3 points.
“The mood is still characterized by uncertainty and worries,” explained NIM consumer expert Rolf Bürkl. “There are no signs of a sustained recovery in the coming months.” This uncertainty is particularly evident in the propensity to save, as a more in-depth analysis recently carried out by the NIM showed.
Consumers were asked specifically about their reasons for why they currently consider thrift to be advisable. In the open survey, almost a third of those surveyed said that they were very unsettled by the current political and economic situation and therefore thought it made sense to keep their money together.
In addition to the current conflicts, such as the Ukraine war or the Middle East conflict, the high inflation in Germany plays an important role in the tendency to save, explained GfK and NIM. This concern was mentioned by more than a third of those surveyed.
Inflation as a driver of uncertainty
“This empirically confirms that the propensity to save serves less as an indicator of conscious investment, but can be interpreted primarily as an indication of the extent of consumer uncertainty,” explained Bürkl. “Conversely, this also means that for a sustainable recovery in the consumer climate it is necessary, on the one hand, that inflation is brought back to a reasonable level and that solutions must also be found in the international trouble spots.”
The GfK consumer climate, which has been surveyed regularly since 1974 and monthly since 1980, is considered an important indicator of consumer behavior, which in turn is an important pillar of economic development in Germany. Since last month, the data collected by GfK has been evaluated and published together with the Nuremberg Institute for Market Decisions (NIM), founder of GfK.
For the current survey, around 2,000 people were surveyed from November 2nd to 13th. The consumer climate refers to total private consumer spending, including retail, services, travel, rent and health services.