Germans Express a Desire to Increase Their Saving Habits
Article:
German Consumers Remain Cautious as Saving Prevails Over Spending
Consumers in Germany exhibit continued reluctance toward purchasing and a growing inclination towards saving, reflecting a weak consumer climate. However, experts suggest a turnaround may be imminent.
GfK and the Nuremberg Institute for Market Decisions (NIM) have announced a slight improvement in consumer sentiment for the third consecutive month, albeit at a modest 0.9-point increase to -19.9 points. This optimistic outlook, while higher than November 2024 levels, remains at a lower point compared to the long-term average.
NIM consumer researcher Rolf Bürkl attributes the subdued consumer mood to unpredictable trade and tariff policies from the US government, stock market volatility, and fears of a third consecutive year of economic stagnation in Germany. The decreasing inclination to make purchases and the accompanying rise in savings continue to dampen consumer sentiment.
Economists, on the other hand, exhibit caution over the longevity of the improvement. Andreas Scheuerle of DekaBank asserts that the consumer mood remains stagnant at the level of the corona lockdown for about a year. Alexander Krüger, Hauck Aufhäuser Lampe Privatbank's chief economist, echoes this sentiment, attributing the slow progress to employment concerns.
In a contrasting development, consumers are almost as positive about their financial situation as they were in October 2024. Good wage arrangements and reduced price increases have created more disposable income. Nevertheless, the inclination for larger purchases has declined. GfK notes that, despite improved income prospects, consumer demand is not demonstrating a corresponding increase.
This study, commissioned by the EU Commission, involved interviewing 2,000 consumers between May 1 and May 12, 2025.
Related Factors:- Economic Uncertainty: Ongoing uncertainties include unpredictable U.S. tariff and trade policies, stock market volatility, and concerns about a potential third consecutive year of economic stagnation in Germany.- Cautious Spending Behavior: The declining willingness to buy and the increasing propensity to save indicate that consumers are prioritizing savings over spending due to economic uncertainty.- Low Consumer Sentiment Levels: Despite improvements in economic and income expectations, overall consumer sentiment remains extremely low, indicating a persistent level of uncertainty among consumers.- Mixed Indicators: The improvement in economic expectations alongside cautious spending habits reflects the complexity of consumer behavior during uncertain economic times.
- The ongoing economic uncertainty, including unpredictable U.S. tariff and trade policies, stock market volatility, and fears of a third consecutive year of economic stagnation in Germany, could influence the community policy and personal-finance aspects, as consumers are prioritizing saving over spending due to these factors.
- Despite an improvement in economic expectations and good wage arrangements resulting in more disposable income, the employment policy may continue to be a concern as consumer demand is not demonstrating a corresponding increase, possibly due to growing apprehensions about job security.
