German consumer sentiment looks stable despite economic downturn. (picture alliance/dpa)
Consumer sentiment in Germany is set to stay at the same level this month, the GfK market research institute said Wednesday, despite signs of an economic slowdown in the country.
The market researchers said that although German consumers have lost confidence in the economy, which is at its lowest point for more than six years, they continue to see positive developments in their own incomes.
GfK forecasts that consumer sentiment will stay at 9.7 points going into September, after three consecutive months of decline.
Consumer sentiment expert Rolf Buerkl said that the ongoing trade conflict between the US and China as well as fears that Great Britain could crash out of the EU without a deal are increasing consumers' concerns that Germany is heading into a recession.
The GfK survey found that the respondents' expectations for the economy went down to its lowest rates since January 2013 to 8.3 points. Income expectations of the respondents however only went down slightly to 50.1 points.
"It is important for consumer sentiment and domestic consumption that the employment market stays stable," Buerkl said.
The German economy is increasingly showing signs of heading into a technical recession, which is typically marked by two straight quarters of contraction. Should that happen, most economists expect the recession to be mild.
On Monday, the Munich-based Ifo institute said that its closely watched business confidence index fell to 94.3 points this month from 95.7 points in July.
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