08-26-2008, 01:06 PM
German consumer confidence has fallen to a fresh five-year low, as recession and high inflation fears continue to sour the mood among shoppers.
The news came from market research firm GFK, whose forward-looking consumer confidence index has dipped to 1.5 points for September from August's 2.1.
Further gloom was offered by restated official data which confirmed that the economy contracted from April to June.
Germany's economic output fell 0.5% quarter-on-quarter in the period.
If this contraction was to continue between July and September, then Germany would formally be in recession.
'Depressed mood'
Fuelled by high energy and food costs, German inflation is continuing at its highest level since 1993, hitting household spending.
German companies are further being hit by high raw material costs, and in addition to lower domestic consumer spending, concerns remain the impact of a global economic slowdown.
The high value of the euro has also been a problem over the past year, although the dollar has rallied in recent weeks, offering some respite to German exporters.
"In addition to the continued price hikes for energy and fast moving consumer goods, expectations of weaker economic development are depressing the consumer mood in particular," said the GFK report.
GFK surveys around 2,000 consumers for its monthly consumer confidence guide.
The news came from market research firm GFK, whose forward-looking consumer confidence index has dipped to 1.5 points for September from August's 2.1.
Further gloom was offered by restated official data which confirmed that the economy contracted from April to June.
Germany's economic output fell 0.5% quarter-on-quarter in the period.
If this contraction was to continue between July and September, then Germany would formally be in recession.
'Depressed mood'
Fuelled by high energy and food costs, German inflation is continuing at its highest level since 1993, hitting household spending.
German companies are further being hit by high raw material costs, and in addition to lower domestic consumer spending, concerns remain the impact of a global economic slowdown.
The high value of the euro has also been a problem over the past year, although the dollar has rallied in recent weeks, offering some respite to German exporters.
"In addition to the continued price hikes for energy and fast moving consumer goods, expectations of weaker economic development are depressing the consumer mood in particular," said the GFK report.
GFK surveys around 2,000 consumers for its monthly consumer confidence guide.