Consumer climate: year-end optimism Findings of the GfK consumer climate survey in December 2004

NÜRNBERG (Germany) 29th December (PROTEXT) - The mood amongconsumers remains unclear. As in the previous months, theindicators used to measure consumer mood provide mixedinformation.

For the third consecutive month, the indicator used toexpress consumers views on the economic outlook lost ground.Following the 0.5 point drop in November, the economic outlookindicator lost a further 1.3 points and now stands at -18.3.This means that the indicator is almost 17 points down on thefigure at the end of 2003.

The indicator for income expectations, which has virtuallyadhered throughout this year to the pattern of an increase inone month being followed by a decrease in the next, hasstabilized just above the previous months level. Following a 2.3point rise in December, the indicator now stands at -13.5 and istherefore five points below the comparable figure for theprevious year.

The number of larger purchases made by consumers isencouraging. Following a period of virtually no change duringthe past few months, when the indicator moved between -27 pointsand -28 points, the indicator recovered 2.1 points in Decemberto stand at -22.3.

Thanks to the rise in the propensity to buy, in particular,the consumer climate overall has also seen an improvement. ForJanuary 2005, GfK forecasts a figure of 2.9 points following therevised figure of 2.6 points for December 2004. This reflects aslight increase in domestic demand potential in the coming year.However, a marked improvement in the employment market is neededto achieve a significant breakthrough. Anxiety about job lossesremains the major obstacle to a sustained trend reversal in theconsumer mood and, in particular, to peoples willingness tospend. Dr. Ulrike Schöneberg, Tel. +49-(0)911-395 2645,ulrike.schoeneberg@gfk.de

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