By Andreas Kiler
BERLIN (Dow Jones) – Despite the ongoing restrictions caused by the coronavirus pandemic, consumer sentiment continued to brighten in May, according to the German Trade Association (HDE). As the association announced, the HDE consumption barometer increased from 96.56 points in April to 97.34 points in May and thus won for the third month in a row. “If consumer sentiment collapsed a year ago in the course of the first lockdown, optimism will prevail this spring,” stated the association. At the same time, however, the corona restrictions ensured “that the increasing propensity to consume can only be lived out to a very limited extent”.
Compared to the previous month, the propensity to buy increases and is significantly above the level from the same month last year, which, however, was significantly affected by the first lockdown in spring 2020. At the same time, the propensity to save is going down. However, the pronounced willingness to consume will only have noticeable effects when there are again opportunities to consume in retail, leisure and tourism. Therefore, it can currently still be assumed that private consumption will probably only grow towards the end of the second quarter or the third quarter.
With a stable labor market, consumers were confident about their own income situation. Compared to the previous month, consumer income expectations even increased. In contrast to the previous months, however, income and economic expectations developed in different directions. A slightly clouded consumer assessment of the economic development coincides with the expectations of the companies. “After more than a year of the corona pandemic, the mood of consumers is becoming independent of the infection rate,” said the HDE. It has been shown that the willingness to consume becomes stronger the longer the corona measures restrict consumption.
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(END) Dow Jones Newswires
May 03, 2021 3:39 AM ET (07:39 GMT)