German consumer morale holds steady going into February as shoppers felt more upbeat about the outlook for Europe’s largest economy. As David Pollard reports, there are encouraging signs elsewhere in the euro zone too despite the slowdown in China.
Low oil prices buoy German consumers
Morale among German consumers is steady – their desire to buy on the up, according to GfK.
Low rates and higher wages means more spare cash.
As do low oil prices – though that silver lining does have a cloud, according to the research group’s Rolf Burkl.
SOUNDBITE (German) ROLF BÜRKL, GFK-Consumer Expert, saying:
Oil-producing nations take a lot of our products – and their income is down right now. Businesses are worried about what that could do to our exports.
And in fact, Germany is revising down its growth forecast to 1.7 per cent this year, from 1.8.
An economy still in good shape, says the government – though economy minister, Sigmar Gabriel, was separately quoted as saying it wasn’t quite good enough.
France too prompting a sense of ambivalence in its latest data.
Consumer morale is holding up better than expected in the wake of the Paris attacks.
But economists see these latest protests over wages and pensions as evidence of the need for reform.
At a time when France is, perhaps, swinging in the opposite direction.
Jeremy Cook of World First.
SOUNDBITE (English) CHIEF ECONOMIST, WORLD FIRST, JEREMY COOK, SAYING:
President Hollande and his government have started to talk about more stimulus into the French economy. It certainly seems that euro zone member countries are not as keen to promote austerity and lower spending as they were two or three years ago. And hopefully that additional spending, that fiscal loosening, will continue to drive growth. But growth is very, very slim in Western European countries at the moment, regardless of what’s going on with the oil price.
Italy also announcing consumer confidence figures.
They’re at their highest in over 20 years.
But business confidence is down sharply.
An economic message even more mixed, it seems, than its euro zone peers.