Home / Business and Economy / German Consumers Brace for Spending Slump Amid Uncertainty
German Consumers Brace for Spending Slump Amid Uncertainty
25 Feb
Summary
- German consumer sentiment unexpectedly fell in March to -24.7.
- Consumers show reduced willingness to buy, signaling hesitant spending.
- Geopolitical tensions and social policy concerns fuel consumer uncertainty.
Consumer sentiment in Germany is projected to decline further in March, as indicated by a recent survey. The GfK market research institute and the Nuremberg Institute for Market Decisions (NIM) reported a drop in the consumer sentiment index to -24.7 points for March.
This unexpected worsening contrasts with earlier analyst expectations and is largely driven by a decrease in consumers' willingness to buy. Concurrently, there has been an increase in the readiness to save among households.
According to NIM's head of consumer climate, Rolf Buerkl, geopolitical tensions and challenges in social policy are contributing to sustained uncertainty. Consumers' economic expectations for the upcoming 12 months have decreased, though they remain higher than the previous year.
Europe's largest economy is currently facing headwinds, with geopolitical uncertainty, high operating costs, and weak domestic demand impacting businesses. Growth projections for 2026 are largely attributed to statistical and calendar effects.
