German consumer morale hit by political uncertainty

Friday, 24 February 2017 00:00 - - {{hitsCtrl.values.hits}}

Inflation in the 19-nation eurozone hit 1.1 percent in December, but Germany -- its largest economy -- saw prices increase 1.7 percent (AFP Photo/Patrik Stollarz)

AFP: German consumers’ mood looks set to darken in March as concerns about rising inflation and US President Donald Trump’s protectionist policies start to bite, a key survey found Thursday.

Market research firm GfK said its forward-looking index for March dipped to 10.0 points from 10.2 in February, slightly below analyst expectations.

Sub-indices measuring consumer sentiment about the future economic situation, income expectations and readiness to spend money all fell back in the latest survey of some 2,000 people.

“The change of administration in the United States and the considerable recent increase in inflation have put a damper on the generally positive consumer mood in February,” GfK said in a statement.

Trump’s pledges to rip up free trade deals and bring back jobs to the US have triggered fears about job security, it noted, particularly among respondents working in export-reliant industries such as car manufacturing and machine engineering.

Inflation in Europe’s top economy meanwhile rose to 1.9% in January, the highest level since 2013.

Despite the concerns however shoppers remain willing to make purchases, the pollsters noted, comforted by record-low unemployment, high wages and low interest rates.

The latest consumer reading echoes a survey by Germany’s ZEW institute earlier this month, which also saw investors fretting about political uncertainties.

By contrast, a closely-watched Ifo poll on Wednesday found that business confidence unexpectedly improved in February.

Discover Kapruka, the leading online shopping platform in Sri Lanka, where you can conveniently send Gifts and Flowers to your loved ones for any event including Valentine ’s Day. Explore a wide range of popular Shopping Categories on Kapruka, including Toys, Groceries, Electronics, Birthday Cakes, Fruits, Chocolates, Flower Bouquets, Clothing, Watches, Lingerie, Gift Sets and Jewellery. Also if you’re interested in selling with Kapruka, Partner Central by Kapruka is the best solution to start with. Moreover, through Kapruka Global Shop, you can also enjoy the convenience of purchasing products from renowned platforms like Amazon and eBay and have them delivered to Sri Lanka.