Thursday, April 23, 2015

Prospect of higher income raises consumer sentiment – Reuters Germany


Berlin (Reuters) – Rising incomes spur the buying mood in Germany.


She is currently as good as since October 2001 no longer, as the Nuremberg market researcher GfK announced on Thursday to its survey of 2,000 consumers. The barometer for the GfK consumer climate in May rose 0.1 points to 10.1. For better mood especially hope to provide significant wage increases: The barometer of income expectations rose to its highest level since reunification. “The consumer enthusiasm so should continue undisturbed even in the summer,” said BayernLB economist Stefan Kipar.


The low inflation plays a key role, stressed GfK expert Rolf Bürkl: “There is more real in purses.” This also expect the leading economists in their spring report – particularly because of the drop in oil prices. Falling costs for heating and fueling let the Germans in this year thus about eight billion euros more in their pockets. The decline in oil prices dampens inflation: 2015 should come to only 0.5 percent inflation. As a result, the purchasing power rises tangibly as wage growth is expected to be well above the rate of inflation. The Federal Bank speaks of an exceptionally good consumer sentiment, which is likely to continue for some time.


However, the propensity of consumers eased to buy cars, furniture, or other expensive goods. Nevertheless, the GfK researchers speak of continued high propensity to consume. At the same time, consumers do not look quite so optimistic on the economy. According Bürkls “the constant back and forth about Greece’s future in Europe now but initial impact with consumers’ clearly shows.


According to the GfK expert face to consumers for some time again to rising prices. “We have obviously reached a turning point,” Bürkl told Reuters TV. “The prices for gasoline and energy are so last rose slightly again in general.” In addition, the low Euro exchange rate should increase the cost of imported goods and thus press something on the buying mood. However, bank analyst Kipar keeps this effect on low, “because the majority of consumer goods in the domestic or the monetary union is based in euro.”


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