German consumer confidence firms at three-year high: GfK

26th October 2010, Comments 0 comments

German consumers are at their most bullish for three years, a survey suggested Tuesday as Europe's top economy steamed ahead and unemployment remained relatively low.

The index for November, drawn up by the GfK market research group, stabilised at 4.9 points, the same level as in October. A GfK spokeswoman told AFP the survey aimed to predict confidence levels for the coming month.

For the fifth consecutive month, consumers had a rosier view of the economy in the future, showing they "continue to believe in a considerable economic upswing over the next months," GfK said.

"In connection with considerable easing on the labour market, the good consumer sentiment will result in further stabilization of domestic demand," added the group.

Last week, the German government sharply hiked its economic forecasts, projecting growth of 3.4 percent this year and 1.8 percent in 2011.

Germany, the world's second largest exporter after China, suffered more than most from the global downturn as demand for its goods dropped sharply. The German economy contracted by 4.7 percent in 2009.

"For German private consumption, the next months will be the moments of truth," ING senior economist Carsten Brzeski commented.

"The fundamentals for a further pick-up in consumption have hardly been better over the last ten years," he said.

With unemployment falling, even Germany's liberal economy minister has called for higher wages, the economist noted.

© 2010 AFP

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