German consumer morale hit by infections

Consumer morale in Germany is weighed down by a surge in infections.

That's according to market researchers the GfK institute Thursday (November 25).

The group's closely watched consumer sentiment index fell to -1.6 points heading into December - down from exactly 1 a month before.

The December reading is the lowest since June, and may dampen business hopes for the Christmas shopping season.

GfK researcher Rolf Buerkl:

"There are the current restrictions, many people will now be afraid again to go shopping as they worry about getting infected. And as a lot of the Christmas markets have now been cancelled the buzz is now missing from the city centres which is bad news for high street shops."

A rise in new infections over the past few weeks could kick away Germany's last driver of growth in the final quarter of the year.

And the health crisis is not the only point of concern for GfK - inflation is another problem.

"On the other hand we are experiencing price hikes and rising inflation which are currently above 4%. And these two things together are really pinching the consumer sector at the moment."

The survey was released before detailed GDP data which showed Germany grew 1.7% in the third quarter, below initial readings.

The GfK Institute's index also found more gloomy data for Europe's largest economy.

Consumer expectations for their personal income and the economy's development have dropped, and the customer will to buy was at a nine-month low.

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