Market sentiments around consumption remained static in August, following a previous positive trend.
The German Retail Federation (HDE) has reported that consumer sentiment stagnated in August 2021, as indicated by the HDE consumer barometer. The index stood at 97.64 points, almost unchanged from July.
The stagnation in consumer sentiment, as shown in the August consumer barometer, could potentially mark the beginning of a negative trend, according to the HDE. This stalled recovery in sentiment, which had been slowly improving in previous months, is attributed to uncertainty driven by economic policy developments and geopolitical conditions.
Despite a slight increase in purchasing intentions among consumers, the overall willingness to consume remains subdued. This, coupled with a rising tendency to save, makes a short-term recovery in private consumption unlikely.
The HDE consumer barometer is based on a monthly survey of 1,600 citizens about their purchasing and saving intentions, financial situation, and other consumption-related factors. The survey results suggest that consumers are cautious about the economic outlook.
Interestingly, consumers are assessing their own income situation significantly more optimistically. This could be due to falling inflation and lower energy prices. However, this optimism does not seem to be translating into increased spending, as consumers remain cautious with a weak propensity to spend.
It's important to note that the consumer barometer does not reflect current consumer behavior, but rather the expected mood in the coming three months. This indicates that consumers are adopting a cautious approach to their spending, with a focus on saving for the future.
In conclusion, the HDE consumer barometer for August 2021 suggests a stagnation in consumer sentiment, with consumers remaining cautious and hesitant to spend. This cautious approach, coupled with a rising tendency to save, makes a short-term recovery in private consumption unlikely.
- The stalled recovery in consumer sentiment, as highlighted by the HDE, may be influenced by various policy developments, particularly employment and finance, which could add to the economic uncertainty.
- Despite the optimistic assessment of their own income situations by consumers, the focus on saving, as indicated by the HDE consumer barometer, seems to be driven by concerns regarding future financial stability and business conditions.
