The FINANCIAL — German consumer sentiment is set to weaken for the third month in a row in November, amid signs that the migrant crisis may be taking its toll, market research group GfK said on October 28, according to Nasdaq.
The forward-looking GfK consumer sentiment index is expected to fall to 9.4 points in November from 9.6 points in October, GfK said. The expected reading is in line with economists’ expectations in The Wall Street Journal’s survey of analysts.
GfK uses three sub-indexes–all of which refer to the month surveyed–to derive the consumer sentiment figure for the forthcoming month. In October the economic expectations sub-index dropped sharply, falling to -2.9 points from 6.4 points in September, declining for the fifth month in a row and hitting a negative figure for the first time since May 2013, GfK said.
“Like last month, economic expectations are decreasing significantly, seemingly as a result of the feelings created by the ongoing refugee crisis in particular,” GfK said. The downward trend in the economic outlook reflects Germans’ concerns that the labor market will worsen in the coming month, with 44% of respondents saying that they expect unemployment to rise, or rise significantly over the new few months.
GfK said that 70% of respondents who believe that unemployment will increase over the next few months, cited the massive influx of asylum seekers as the primary cause for their concerns. However, German consumers said they don’t think that Volkswagen’s emissions scandal presented much of a risk to the labor market, according to GfK.
Germans’ income expectations remained unchanged at 47.7 points in October, while their “willingness-to-buy” fell to 45.9 points from 50.4 points, although still at a solid level amid noticeable increases in income.