Germans express a desire to increase their savings
Article:
German Consumers Maintain Cautious Spendinghabits Amid Uncertainty
According to recent data from market research firm GfK and the Nuremberg Institute for Market Decisions (NIM), consumers in Germany continue to exhibit a cautious attitude toward spending, despite a slight improvement in the consumer climate for the third consecutive month.
The consumer climate for June showed only a small increase compared to May, remaining at a historically low level. Although consumers' inclination to save has increased, their willingness to make purchases has decreased, leading to a dampened overall consumer mood.
"The unpredictable trade and tariff policies of the US government, coupled with concerns over stock market volatility and the potential for a third consecutive year of stagnation, are likely contributing to the continued weakness in the consumer climate," said Rolf Bürkl, consumer researcher at NIM.
Experts have expressed concern over the stability of the consumer climate and whether it is ready to support larger consumption increases. "The consumer climate has improved, but it has been stagnating at the level of the Corona lockdown for about a year," said Andreas Scheuerle of DekaBank. Alexander Krüger, chief economist at Hauck Aufhäuser Lampe Privatbank, added, "The mood is not yet robust enough for significant consumption growth."
Although the study involved interviews with 2,000 consumers conducted between May 1 and 12, 2025, several factors continue to impact the consumer climate in Germany. These include ongoing trade tensions, tighter financing conditions and higher interest rates, and the correction in the property sector.
While positive factors such as rising real wages and easing inflation may support consumer spending, consumer confidence has been waning, particularly in March and April, due to precautionary saving motives and efforts to rebuild wealth buffers eroded by inflation.
As a result, although the German economy is expected to show a moderate recovery in consumption, overall growth is projected to remain stagnant in 2025, with a rebound expected in 2026 as domestic demand strengthens. The economic outlook for Germany suggests an anticipated GDP growth of 0% in 2025, a slight increase to 1.1% in 2026, decreasing inflation (2.4% in 2025, 1.9% in 2026), and a slight rise in unemployment (3.6% in 2025, 3.3% in 2026).
In summary, the German consumer climate shows signs of cautious optimism, driven by positive factors such as increased purchasing power and easing inflation, but tempered by broader economic uncertainties. As employment concerns and other factors continue to affect consumer confidence, the consumer climate in Germany may exhibit further volatility in the short term.
Source: ntv.de, kfe/dpa/rts
- The ongoing trade tensions, tighter financing conditions, and higher interest rates in the German economy might influence both the community policy and personal-finance sectors, as these factors could impact employment and business opportunities.
- Financial experts suggest that despite the slight improvement in the consumer climate, it is essential to carefully consider employment policies in various industries, since the market volatility and uncertain economic outlook could create obstacles for significant personal-finance growth.
