Market researchers have said that German consumers continue to look to the future with confidence despite the ongoing eurozone debt woes. But the latest data did not yet gauge the impact of the Cypriot rescue deal.
GfK market researchers said Wednesday that the rise in German consumer confidence as seen in the past few months had come to a halt. Their closely watched index remained unchanged at 5.9 points for April, while subindices revealed a heterogeneous picture.
"While expectations for economic growth rose slightly in comparison with our March figures, consumers have slightly lower expectations as to their income situation, and they also looked slightly less inclined to buy products," the GfK said in a statement in Nuremberg.
The results of the survey were based on a poll among 2,000 German consumers. But, though it was conducted after Italy's inconclusive election, it did not measure the possible impact of the last-ditch rescue package for eurozone member Cyprus.
Focusing on domestic demand
GfK researchers expressed some doubt whether confidence levels among German consumers would remain so strong in the months ahead.
"The current events surrounding Cyprus certainly have the potential of negatively affecting the climate for consumption in Germany," the group said.
But many analysts said they were confident that the favorable domestic situation in Germany will be able to compensate for instabilities elsewhere. "The Italian election for instance didn't smash German consumer confidence," said Berenberg Bank economist Christian Schulz.
"Our labor market is stable, there have been decent wage hikes and inflation is low, meaning that all in all households have more to spend on goods," Schulz added.
hg/hc (dpa, AFP, Reuters)