So-So Consumer Vibes in Germany's Economy: May 2025
Economic uncertainty persists: Consumer confidence remained stationary in May - Economic stability: consumer confidence remained unchanged in May
In the last month of spring, consumer sentiment in Germany showed modest growth, jumping from 96.02 to 96.10 points. Despite the slight uptick, this index still remains on the shaky side of neutral, according to the HDE.
The recent increase in pessimistic economic forecasts and heated trade tensions following Obama-style tariff announcements and suspensions have added strain to the mix, according to the HDE. Fortunately, consumers haven't let worry cloud their crystal ball.
At the same time, people in Germany seem disillusioned about the new federal government's potential to boost the economy. The retail association insists that "to kindle optimism and spark consumer activity, the new government must squash this uncertainty."
Income expectations crept up a bit, from 98.28 points to 98.67 points. Households are planning to stash some extra dough away for a rainy day and loosen the purse strings for some retail therapy. Saving and purchase intentions also ticked slightly upward.
Lower political uncertainty has played a part in the slight turnaround, but broad economic expectations haven't had a significant boost.
The Consumer Sentiment Index is a barometer of what folks expect for the next three months, not a snapshot of their current shopping habits. HDE quizzes around 1,600 folks each month to get a read on their spending plans, saving intentions, financial situations, and other spending-related factors.
- Germany
- Consumer Sentiment
- GfK Consumer Climate Index
- HDE
- Federal Government
- Political Uncertainty
- USA
- Trade Tensions
- ZEW Indicator of Economic Sentiment
- The HDE, Germany's retail association, suggests that the new federal government needs to address political uncertainty to kindle optimism and stimulate consumer activity.
- In addition to the GfK Consumer Climate Index, the HDE also conducts monthly surveys to gauge consumers' spending plans, saving intentions, and other financial-related aspects.
- While the recent slight increase in consumer sentiment in Germany is somewhat encouraging, broad economic expectations remain unchanged, according to the HDE.
- The optimism of consumers in Germany seems unperturbed by the recent tariff announcements and suspensions, which have increased trade tensions with the USA, as reported by the HDE.
