BERLIN, Nov. 28 (Xinhua) -- Consumer sentiment in Germany has deteriorated slightly during the month of November, a study published on Wednesday by the GfK market research institute finds.
"Overall, consumer sentiment in Germany showcases a more moderate image in November," a statement by GfK read.
According to the study, the proclivity of Germans to spend on consumer goods rose once again from the already high level of the previous month. However, this positive effect was more than offset by dampened growth and income expectations held by consumers, as well as an increased propensity to save.
GfK consequently predicted that its consumer sentiment barometer would fall by 0.2 percent to 10.4 percent towards the end of the year. The findings were based on a regular survey of around 2,000 respondents which has been conducted by the Nuremberg-based institute since 1980.
The monthly fall in consumer sentiment was largely attributed to a weakening of economic momentum in Germany, resulting in the second consecutive decline in growth expectations to 17.4 points (minus 1.6 points) observed in the survey. GfK noted that, consumers were also markedly more pessimistic about the prospects of the German economy compared with the same period last year (minus 26 points).
Official figures published by the Federal Statistical Office recently revealed that German gross domestic product (GDP) declined for the first time since early 2015 by 0.2 percent in the third quarter (Q3) of 2018. The government statisticians identified the primary cause of the quarterly recession in falling exports and logistical issues stemming from the introduction of a new certification process in the European automotive industry.
In light of this trend, GfK cautioned on Wednesday that an ongoing trade conflict between the European Union (EU) and the United States was "not yet conclusively resolved." Combined with uncertainties stemming from the looming departure of the United Kingdom from the bloc, a resulting threat of German exports being impeded by new tariff barriers continued to weigh on consumer sentiment.
Furthermore, the market research institute emphasized that its indicator for income expectations was at its lowest level measured so far in 2018 with 50.2 points (minus 4.2 points). Annual inflation had risen rapidly to 2.5 percent in October, resulting in less disposal income for spending by consumers.
Nevertheless, the indicator still remained at a "very good level" in historical terms thanks to a booming German labor market characterized by record low unemployment and record high employment.
