- Market research company GfK
Confidence among German consumers unexpectedly eased heading to September, albeit still remaining close to the highest level in almost six years, as shoppers are getting more cautious about creeping inflation. A new poll from Gfk market research group showed that its forward-looking sentiment measure dropped to 6.9 going to September, down from 7.0 a month earlier- the highest level since the onset of the global financial crisis. The outcome defied estimates for an increase in the indicator to 7.1. Moreover, economic expectation of consumers in Europe's largest economy slipped for the first time in four months, with the corresponding index tumbling to 1.8 down from 4.3 in July. The main reason for such a deterioration was a rise in food prices, which drove a 1.9% increase in annual inflation in July- the fastest rate this year so far.
Consumers were less optimistic even despite the economic recovery and better-then-expected growth figures, which showed the economy expanded at the fastest pace in more than a year. However, the research company expects several setbacks in the reading as the recovery is likely to be rather moderate. Confronting Gfk projections, the majority of analysts are expressing views German economy will grow at a faster rate than the current projections, made by the Bundesbank, which expects a 0.5% expansion this year.
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