Consumer sentiment in Germany deteriorated in November after a period of recovery, the latest HDE (Handelsverband Deutschland) consumption barometer data has revealed.
The decline in consumer sentiment follows a surge in infections and growing uncertainties in the job market.
The report noted that consumers are becoming less optimistic about their income expectations as well as the economy.
In the past two years, there has been an increase in the propensity to buy in the run-up to Christmas. This trend has witnessed a marginal decline this year.
The report predicts that the recovery in consumer sentiment is likely to stop, and that sentiment will deteriorate again if infections continue to rise and new containment measures are introduced.
In the near future, a noticeable increase in private consumption is unlikely and there could be an additional negative impact after the expiry of the temporary VAT reduction scheme.
The HDE Consumption Barometer is a monthly report based on a survey of 2,000 respondents sharing their propensity to buy and save, taking into account their financial situation and other factors relevant to consumption.
It does not reflect current consumer behaviour, rather the expected mood over the next three months.