German consumer confidence steady in March, despite poor views on economy
Few changes in Germany's consumer climate are expected next month, despite a "steep" drop in economic expectations and dip in buying intentions.
GfK's consumer sentiment index for Germany is seen holding at 10.8 in March, the consultancy said in a statement, despite a retreat in consumers' so-called 'propensity to buy' and the "steep downward spiral" in economic expectations.
But only because income expectations were stable and thanks to a dip in Germans' propensity to save, GfK said.
"Consumers feel that the risk of the German economy slipping into recession again has tangibly increased in recent weeks."
The sub-index linked to economic expectations dropped by another 6.5 points and for a fifth successive month to reach a level of 4.2 - marking its lowest ebb since March 2016.
That gauge was also 41 points below the year earlier level.
According to GfK, the main reasons behind Germans' more pessimistic take on current conditions are the ongoing trade disputes between Europe, the US and China, together with the risk of a 'no deal' Brexit which "makes planning more difficult for companies on all sides".
Nonetheless, while the sub-index tracking the 'propensity to buy' fell by four points to 53.6, nearly erasing all of the prior month's gains, it was still just three points below its year-ago level.
"A decent headline, indicating that the advance index is holding on to its gains since the end of last year. That said, the headline index doesn’t correlate well with spending. The details are better, though they were mixed this month," said Claus Vistesen, chief European economist at Pantheon Macroeconomics.
"On balance then, a soft report but the survey as a whole continues to signal a rebound in consumers’ spending growth in coming quarters."