Consumer climate remains modest Findings of the GfK consumer climate survey in November 2004

NUREMBERG (Germany) 26th November (PROTEXT) - Movement in theindicators reflecting the consumer climate is still unclear.Although the indicators again failed to provide a clearlypositive outlook, there is no longer any sign of the marginallynegative trend of the previous month. The trend in Germany forconsumers to make long-term purchases has even recoveredsomewhat. Expectations for the economy and growth in personalincome, however, remained almost unchanged. As a result, thevalue of the consumer climate has risen accordingly and afterthe revised figure of 2.4 in November it stands at 2.7 pointsfor December.

There is a strong correlation in Germany between the tendencyto make long- term purchases and personal income expectations andjob security, neither of which is currently at its highest atpresent. Nevertheless there is an upward trend in buyingpropensity, although this should be seen as more of a sign thatthere is a certain need to catch up and that consumers are usingChristmas as an opportunity to carry out purchases, despite thetense situation regarding incomes. As expected, the usualChristmas purchases also play a role here.

Converting this into increased demand for consumer goods willbe dependent on the next phase of tax reforms leading toimproved incomes in real terms, without being considerablyovershadowed by new and unforeseen burdens. A widespread upturnin consumer mood is not expected until there are clear signs notonly of economic recovery, but also of easing in the situation inthe labour market. Contact: Dr. Ulrike Schöneberg, Tel. +49 (0)911 395-2645 ulrike.schoeneberg@gfk.de

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