German consumer confidence falls

Analysts cite fears of trouble in wake of Brexit, summer of violence

FRANKFURT, Sept 28, (AFP): German consumers’ mood brightened slightly in September, a monthly survey found on Wednesday, but researchers spotlighted fears of trouble in the wake of Brexit and a summer of violence.

The headline consumer sentiment index from market research firm GfK crept up to 10.2 points in September.

But the pollsters said that “just the announcement that Britain would leave the EU has caused increased uncertainty” and forecast a slight fall in consumer confidence in October.

Analysts surveyed by Factset had predicted the index would remain steady in October.

GfK warned that “overall the atmosphere among consumers was slightly weakened,” pointing to sub-indices that showed falling inclination to buy, income expectations, and expectations for the whole economy.

GfK acknowledged that the overall reading reflected a “stable mood at a good level” so far, while all three subindices remain at higher levels than the same time last year.

The European Central Bank in September lowered its growth forecast for the 19-nation eurozone in 2017 and 2018 slightly, partly in response to the June 23 vote.

Consumers’ fears of potential Brexit fallout contradicted attitudes among German businesspeople, which an Ifo institute survey on Monday showed soaring in expectation of a “golden autumn” for Europe’s biggest economy.

Meanwhile, GfK noted that two terrorist attacks in Bavaria in July — which wounded 20 but only claimed the lives of the attackers — as well as a rampage shooting in Munich had caused “general disquiet”.

“Consumer sentiment isn’t immune to growing uncertainty,” the researchers concluded.