CAPTION: Fear of inflation and recession in Germany. (picture alliance/dpa/Monika Skolimowska)
Fear of a further increase in inflation on the one hand and of a recession in the economy on the other is causing the mood of German consumers to worsen. Expectations regarding income and the economy in particular have recently declined again, consumer research company GfK noted in its June Consumer Climate Index. The Nuremberg-based researchers present their findings on consumption in Germany in monthly surveys.
"The current trend in consumer sentiment indicates that consumers are once again becoming more unsettled," said GfK consumer expert Rolf Bürkl. "This is reflected, among other things, in the fact that the propensity to save is on the rise again this month," he said. In each of the past eight months, the consumer climate had risen slightly. In the June survey, however, GfK forecasts a slight decline again for the first time.
"Continuing high inflation rates of currently around 6 percent are noticeably nibbling away at household purchasing power and preventing private consumption from making its positive contribution," Bürkl said. The current discussion about the heating law also hurts because it puts the brakes on investments elsewhere. However, inflation is on the decline, he added, saying that this could become a bright spot in the coming months.
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