German consumer confidence fell for the first time since October last year. This was reported by the market research agency GfK. Concerns about high inflation and an economic downturn in Europe’s largest economy have flared up again among Germans.
In October, German consumer confidence fell to an all-time low amid household concerns about sharply rising gas prices and possible gas shortages. Confidence has increased since then, helped by falling energy prices, but great uncertainty remains for consumers.
Two quarter contraction
Germany entered a recession in the first quarter with two consecutive quarters of contraction. Economic research institutes in Germany expect a slight contraction in the economy for the whole of the current year.
GfK argues that the decline in confidence indicates that consumers are increasingly uneasy about the economy. People may hold on to their purse strings further due to inflation, which is more bad for the economy. However, inflation has slowed recently, which could provide some relief for households, according to GfK.
Source: BNR
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