BERLIN, Nov. 26 (Xinhua) -- Consumer sentiment in Germany picked up again in November to 9.6 points, according to the monthly consumer climate study published by market research institute GfK on Tuesday.
Both economic and income expectations had seen a "marked increase", the German institute announced. The index is based on around 2,000 consumer interviews conducted on behalf of the European Commission.
Because of risk factors such as the global economic slowdown, trade conflicts and the ongoing discussions about Brexit, consumer climate in Germany dropped slightly compared to the same period last year.
However, the indicator's level could "still be described as highly satisfactory while propensity to buy remains stable."
"The exceptionally high levels of consumer confidence among German consumers have significantly contributed to preventing a recession" in Germany in the third quarter (Q3), said Rolf Buerkl, consumer expert at GfK. "Private consumption has thereby perfectly fulfilled its role as an important pillar of the economy."
The German economy grew by 0.1 percent in Q3 which was "contrary to expectations", GfK noted. "Many experts had predicted a slight contraction, which would have meant Germany sliding into a technical recession," as this would have been the second consecutive decline.
According to GfK, consumer expectations in Germany had seen a "noticeable improvement" in November, "bringing an end to the downward trend, at least for the moment."
The consumer expectations indicator gained 15.5 points compared to the previous month, climbing to 1.7 which was slightly above its long-term average of zero points, GfK noted.
The decline in the pessimism of consumers was "most likely due to the trade war between the U.S. and China showing tentative signs of easing" during recent days, the German market research institute stated.
According to GfK, meanwhile, income expectations in Germany also showed an increase in November. The indicator gained 6.5 points to 45.5, an increase that "almost completely compensates" for the losses recorded in the previous month.
"Consumers continue to remain highly optimistic about the development of their future financial position," the GfK stated. Reasons for these were the current employment situation in Germany, with a positive development of salaries and pension schemes in Germany.
Income expectations had been "further strengthened" by price trends in Germany, GfK noted.
According to figures by Destatis, inflation in Germany dropped to 1.1 percent in October from 1.2 percent in September.
However, "lower inflation rates strengthen the buying power of consumers" in Germany, Gfk found.
German consumers would be "optimistic about the upcoming holiday season, one of the busiest times of year for a number of retail industries such as consumer electronics and toys", said Buerkl, consumer expert at GfK. "And the retail sector can certainly look forward to this period with a healthy dose of optimism."
As a result, GfK forecast a figure of 9.7 points for December, 0.1 index points higher than November's level.
