The mood among German consumers darkened heading into September.
A survey from the GfK institute revealed accelerating inflation and rising cases made them more hesitant to buy.
GfK consumer expert Rolf Buerkl:
"High inflation is a sensitive issue, especially in Germany. We know from past experience that this always has a negative effect on consumer morale. Apart from rising infection numbers, a drop in vaccinations and discussions on regulations, rising prices also play a role."
The institute said its consumer sentiment index, based on a survey of around 2,000 Germans, dropped to -1.2 points for September, worse than analysts had forecast.
Germany's harmonised annual consumer prices rose over 3 percent in July, hitting a 13-year high.
And fuelling a debate about whether the increase in the cost of living will persist.
GfK's consumer climate indicator forecasts the development of real private consumption in the following month.
A value below zero indicates a drop compared with the same period a year ago.
For now, the institute says many Germans feel concerned about the rising number of cases.
And the speed of the country's vaccine rollout.