After five months on an upward trend, the recovery in consumer sentiment in Germany weakened in April. This is revealed by the latest consumer barometer of the German Retail Association (HDE). According to this, the index remained almost at the level of the previous month of March. According to the HDE, no growth impetus is expected in private consumption. The propensity to save is also declining. This development is attributable to the recent macroeconomic gloom and uncertainty.
The next few months will show whether the halt in the upward trend will trigger a turnaround. The continuing high inflation rate and economic uncertainty are weighing on private consumption.
Consumers are pessimistic about overall economic growth in the coming months. Their economic expectations are affected by the deterioration in economists’ outlook, which gives consumers no hope of a tangible macroeconomic recovery in the near future. Accordingly, income expectations are also becoming gloomier. In particular, the inflation rate, which remains high, is likely to dampen expectations.
The HDE consumer barometer is published monthly and is based on a survey of 1,600 people on the propensity to buy, the propensity to save, the financial situation and other consumption-related factors. It does not reflect current consumer behavior but rather the expected mood over the next three months.
