Everything is pointing towards a considerable improvement in the consumer climate in Germany, according to findings of the GfK consumer climate survey in January 2005. In the wake of three setbacks, the indicator for economic expectations was clearly up in January. A value of -5.9 showed an improvement of 12.4 points over and above the previous month, to reach its highest level since April 2004.
With a value of plus +6.7 points, the indicator for income expectations has again risen above its long term average of 0 for the first time since April 2004. The indicator, which stood at -13.5 points in December, was up at least 20 points in January and it looks as if income expectations have finally left their lowest level of -19.5 points in August 2004 firmly behind.
The propensity to buy is also currently on the increase in the wake of the positive developments in economic and income expectations. In November and December, the increased propensity to make larger purchases indicated an overall improvement in consumer climate. The trend has been sustained. The value, which was already up 2.1 points in December 2004 to -22.3, has risen a further 7.9 points to -14.4.
The consumer climate has improved and this is due, in particular, to the clear upturn in income expectations. Hot on the heels of the upward revision of 3.1 for January 2005, GfK is forecasting a value of 4.1 for February 2005. It looks as if 2005 has started well. Domestic demand once again made a more important contribution to the positive economic development. However, for a lasting improvement in the consumer climate, the situation on the job market will have to stabilise so as to give consumers a greater feeling of job security.
