German consumer confidence is set to rise in October underpinned by strong improvement in income prospects and propensity to consume, survey results from the market research group GfK showed on Tuesday.
The forward-looking consumer confidence index rose to +0.3 points from -1.1 in September. The score was forecast to fall further to -1.5.
The consumer climate index has reached its highest level since April 2020.
“Even if the consumer climate has almost reached its pre-crisis level, it remains to be seen whether we can speak of a fundamental trend reversal,” Rolf Bürkl, GfK consumer expert, said.
“What matters here is how the infection process will develop in the winter months and whether new restrictions will be necessary,” Bürkl added.
Both economic and income expectations as well as the propensity to buy advanced in September.
The economic sentiment indicator gained 7.7 points to 48.5 points in September. Rising optimism signals that consumers consider the German economy on course for recovery. A stable labor market also contributed significantly to the high level of economic expectations.
In September, the income expectations indicator climbed 6.9 points to 37.4. The survey showed that the rise in inflation have no significant influence on income expectations.
In addition, extremely stable employment figures ensure that unemployment fears and the associated worry about loss of earnings do not currently play a notable role.
After a plus of 3.1 points, the propensity to buy indicator currently showed a value of 13.4 points. Nonetheless, the index remained at a low level as the obligation to wear masks and maintain social distancing rules dampen any enthusiasm to shop.
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