Germany's economic expectations climb, but growth fears persist: Gfk
Consumer sentiment in Germany presents a mixed outlook for May, with noticeable improvements in economic and income expectations. However, the willingness to buy has declined slightly, while the inclination to save has risen again. The consumer climate indicator forecasts a moderate increase of 0.9 points to -19.9 for June 2025, up from a revised -20.8 in May, according to the GfK Consumer Climate powered by NIM, jointly released by NIQ and the Nuremberg Institute for Market Decisions (NIM).
Both the slight decline in the willingness to buy and the increasing willingness to save are currently having a dampening effect on consumer climate and are preventing the noticeable growth in income and economic prospects from having a stronger impact on the consumer climate this month. The savings indicator rises by 1.6 points in May—following a significant decline in the previous month- and climbs to 10 points, as per the report.
Consumer sentiment in Germany remains mixed in May, with income and economic expectations rising, but willingness to buy falling and saving increasing. The consumer climate index improved slightly to -19.9, the highest since November 2024. Concerns over trade policies, market volatility, and stagnating growth continue to dampen sentiment. However, there is no economic growth forecast for 2025.
The consumer climate has risen for the third consecutive month, though the increase is moderate at 0.9 points. At -19.9 points, it has reached its highest level since November 2024, when it stood at -18.4 points.
'The level of consumer sentiment remains extremely low, and consumer uncertainty remains high,' said Rolf Burkl, consumer expert at the NIM . 'The unpredictable customs and trade policy of the US government, turbulence on the stock markets and fears of a third consecutive year of stagnation are reasons why the consumer climate remains weak. In view of the general economic situation, people seem to think it advisable to save.'
Consumers' income expectations increase noticeably in May. The indicator gains 6.1 points, climbing to 10.4 points. This is the highest value since October 2024—when 13.7 points were measured. Compared to the same period last year, however, there was a small drop of 2.1 points.
Consumers in Germany are increasingly optimistic about their income due to favourable wage agreements and easing inflation, which stood at 2.1 per cent in April. However, this has not translated into greater willingness to buy, which fell to -6.4 points amid concerns over trade policies and rising unemployment.
Meanwhile, economic expectations rose for the fourth straight month, reaching 13.1 points—it's highest since April 2023. Despite this optimism, the German Council of Economic Experts forecasts no growth in 2025, with a modest 1 per cent rebound expected in 2026.
The findings are drawn from the GfK Consumer Climate powered study, based on approximately 2,000 monthly consumer interviews carried out on behalf of the European Commission.
Fibre2Fashion News Desk (SG)
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