The rising prices are spoiling Germany's consumers

The fourth wave of corona and the rising prices are spoiling Germany's consumers a few weeks before Christmas. The consumer climate determined by GfK fell significantly in December by 2.6 to minus 1.6 points, as the market research company announced. The propensity to save rises again, the propensity to buy declines - and sinks to a nine-month low. Last month, the consumer climate had reached its highest level since April 2020, when consumer sentiment rose again after the shock of the first lockdown in the corona pandemic. Now the fourth wave of the corona pandemic and the high inflation rate of currently more than four percent have "melted away" purchasing power, said GfK expert Rolf Bürkl. That dampens the prospects for the upcoming Christmas business. Consumers are reacting to the news that the recovery of the German economy has stuttered. The main culprit is interrupted supply chains. Their economic expectations are therefore falling, for the second time in a row. Therefore, according to GfK, income expectations are also suffering. However, they are not as strong as in October. "In the wake of falling economic and income prospects, the propensity to buy also declines in November," explained Bürkl. A low value for this indicator was last measured in February 2021. For its representative studies on the consumer climate, GfK conducts monthly interviews with consumers on their economic expectations, their income expectations and their propensity to buy. For the current survey, around 2000 people were interviewed from November 4th to 15th. Consumption is an important pillar of economic development in Germany. The consumer climate index had been around ten points for years before the outbreak of the corona pandemic. The value of 1.0 point in October was the highest since then.