German consumer confidence drops as infections rise
By Sean Farrell
Date: Friday 28 Aug 2020
(Sharecast News) - German consumer sentiment suffered a setback as rising coronavirus infections and fears of renewed restrictions to thwart the virus dampened spirits.
The GfK consumer confidence index fell to -1.8 for September from a revised -0.2 for August. The preliminary September figure halted three months of gains.
Economic expectations and willingness to buy showed small gains but household income expectations fell sharply in Europe's biggest economy. The indicator fell by 5.8 points to 12.8 - a loss of 37 points compared to the previous year.
In another sign of growing unease, propensity to save increased as households set aside money against potential hardship.
Rolf Bürkl, a consumer analyst at GfK, said: "An increase in the number of infections and the fear that coronavirus-related restrictions will be further tightened are creating uncertainty and consequently dampening the mood."
Germany has extended restrictions on large events such as festivals and football matches and toughened mask-wearing rules after a resurgence in coronavirus infections.
Bürkl said a VAT cut introduced on 1 July may be supporting people's willingness to buy but it had not had a wider effect on sentiment.
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