Germans Saving for Worse Times

Germans Save Money for Tougher Times Ahead: Key Insights

• Consumer Confidence Plummets: The consumer climate index has dropped to minus 22. A contrast to pre-pandemic levels of plus 10.

• Rising Job Insecurity and Saving Rates: As concerns over unemployment and corporate bankruptcies rise, Germans are saving more, with income expectations dropping sharply by 16.2 points this month.

• Economic Recovery Fading: Hopes for a quick recovery driven by consumer spending are dimming.

Data from GfK and NIM show that the Consumer Climate Index fell by 3.4 points to minus 22. This is a solid decline from pre-pandemic levels, when the index hovered around plus 10 points.

Germans Safe Money For Worse Times

Economic and income expectations are down, while savings rates continue to rise. The brief optimism generated by the European Football Championship has faded, leaving consumers more pessimistic. "The euphoria was short-lived," said Rolf Buerkl, consumer expert at NIM. He emphasized that concerns about job security, driven by rising unemployment and corporate bankruptcies, are further dampening hopes for a quick recovery in consumer confidence.

Private households are particularly worried about their financial future, with income expectations plummeting by 16.2 points this month. The last time such a sharp decline occurred was in September 2022, during a period of higher inflation.

Survey Results Show Declining Consumer Confidence

For the monthly survey, GfK and NIM interviewed around 2,000 people between August 1 and August 12. The survey was carried out on behalf of the European Commission.

Despite hopes that consumer spending would help drive the economic recovery, recent data shows that confidence is faltering. German businesses are also reporting low morale, with purchasing managers signaling a decline in activity in August, particularly in the manufacturing sector.

As the year progresses, the possibility of a stable economic recovery seems less likely, with no clear signs of improvement on the horizon.

German eCommerce Market Declining

The second-largest eCommerce market in Europe declined by 3.2% in August 2024, contrary to the global eCommerce market, which saw a slight increase. Find out more in our monthly eCommerce analysis.