German consumers stay gloomy: GfK
Austerity measures being prepared by the German government have unsettled German consumers, the closely watched GfK confidence survey showed on Wednesday.
The latest poll of some 2,000 people in Europe's biggest economy resulted in an indexed 3.5 points, the same level as for June, the research group said in a statement.
Although consumers' propensity to head to the shops showed a clear rise, in part thanks to the 2010 World Cup in South Africa, talk of higher charges to rein in Germany's public deficit and debt has nonetheless undermined sentiment.
Amid such an environment, improved economic and job market indicators were unable to brighten consumers' moods, GfK said, though their assessment of the current economic environment did mark a modest rise.
German Chancellor Angela Merkel has unveiled an austerity plan that foresees more than 80 billion euros (98 billion dollars) in spending cuts between next year and 2014.
Critics in Germany and abroad have warned the belt-tightening could stifle economic growth, but some economists point out that the prospect of healthier public finances has actually boosted activity in the past.
Berlin has been pressed by neighbours to encourage more consumer spending, but a government source said Tuesday there was "no pressure" from Washington on the issue ahead of a G20 summit of advanced and developing economies in Toronto.
The main effect of the German austerity measures was seen in consumers' assessment of their personal situation, which tumbled from 23.7 points to 8.2 points on concerns the austerity package could pose heavier financial burdens.
The stable general indicator was an improvement meanwhile from the small drop of 0.2 points between May and June, GfK noted.
© 2010 AFP