Germany's GfK Consumer Climate Indicator dropped to -23.3 points in December 2024, its lowest level since May and below the forecasted -18.6, reflecting conditions similar to those in December 2023.
German consumer morale falls to seven-month low
Income expectations fell sharply, dropping 17.2 points to a nine-month low of -3.5, driven by recession concerns, rising unemployment, and lowered growth projections. Increased fears about job security, industrial layoffs, and a rise in insolvencies have heightened uncertainty. Consumer willingness to make purchases also declined, falling 1.3 points to -6, indicating a lack of consumer confidence, even below the levels seen during the early pandemic period. Rising savings intentions (up 4.7 points) further dampened the outlook.
Economic outlook remains pessimistic
The economic outlook remained pessimistic, with the economic indicator dropping to -3.6 points, marking its fourth consecutive decline. Growth forecasts for 2024 and 2025 are modest, at just 0.4%. Overall, ongoing economic uncertainty and weakening income confidence continue to keep consumer sentiment in a slump.
