Consumer Confidence
June 26, 2007
A survey by the Nuremberg-based GfK market research organization showed the overall consumer climate index had grown from a revised 7.4 in June to 8.4 in July, the organization announced on Monday.
"Germans are still in a shopping mood," GfK said. "Rapid successes on the labor market and a globally favorable economic climate ensure that the positive sentiment is continuing into the summer."
The GfK's monthly survey asks some 2,000 consumers about their views on the economy, income expectations and their propensity to buy.
Four months of growth
Along with a positive trend in income expectations, the propensity to buy is again making a significant contribution to the upturn in the consumer climate, the GfK said.
After a weak phase caused by a 3 percent VAT increase, which brought the tax to 19 percent from Jan. 1, the indicator has now risen four times in a row.
"In the light of the current general climate, it is reasonable to assume that the upswing in the consumer climate will be sustained into the coming months," the GfK said.
Shopping expected to continue
On the economic front, the rapid recovery of the job market and a continuing advantageous global economy are ensuring that the positive economic climate will continue through the beginning of summer, it added.
"There's nothing to be worried about this year," said GfK chief Klaus Wübbenhorst. "Consumption will continue to be effective."
But the GfK warned that for both companies and consumers, that sustaining a positive level of consumer development is contingent on political stability and accountability.
"It is possible that disruptive elements, such as protracted debates concerning tax increases and other potential financial burdens or a drastic rise in energy prices could have negative effects on the development of the consumer climate."