BERLIN -Consumer sentiment was down in the euro zone’s three largest economies as high inflation shows no signs of abating ahead of winter, surveys showed on Wednesday.
German consumer sentiment is expected to hit a new high for the fourth month in a row heading into October, according to the GfK institute, which said any recovery in consumer confidence would be linked to inflation being kept under control.
The GfK consumer sentiment index fell to -42.5 in October, after a downwardly revised reading of -36.8 in September and lower than a reading of -39.0 forecast by analysts polled by Reuters .
Income expectations in particular contributed to the fall in morale: this sub-index was at its lowest level since the survey began collecting data for unified Germany in 1991.
French consumer confidence also deteriorated again in September, after a brief recovery in August that ended seven consecutive months of declines due to inflation concerns, according to a monthly survey by the INSEE national statistics office showed.
Italian shoppers were equally depressed before the election, according to the national statistics institute ISTATThe Consumer Sentiment Index in September fell to 94.8, narrowly missing a median forecast by analysts polled by Reuters of 95.1.
Eurozone inflation is approaching double-digit territory in the coming months, driven increasingly by energy costs as Russian gas supplies have become unreliable, making it likely the prospect of a recession in the shared-currency bloc of 19 countries.
germany MKI The institute on Wednesday predicted a broad-based recession for the euro zone’s largest economy in 2023, with sharp declines in private consumption weighing on growth.
A growing number of German consumers fear the economy could slide into recession, GfK said, with economic expectations at the same low levels as during the financial crisis.
OCT 2022 SEP 2022 OCT 2021
Consumer sentiment -42.5 -36.8 0.4
Consumer climate components SEP 2022 AUGUST 2022 SEP 2021
– propensity to buy -19.5 -15.7 13.4
– income expectations -67.7 -45.3 37.4
– economic expectations -21.9 -17.6 48.5
REMARK – The investigation period was from September 1 to September 12, 2022.
The consumer sentiment indicator forecasts the development of real private consumption over the next month.
An indicator above zero signals annual growth in private consumption. A value below zero indicates a decrease from the same period a year earlier.
According to GfK, a variation of one point in the indicator corresponds to an annual variation of 0.1% in private consumption.
The “willingness to buy” indicator represents the balance between positive and negative answers to the question: “Do you think it is time to buy important items?
The income expectations sub-index reflects expectations regarding the evolution of household finances over the next 12 months.
The complementary economic expectations index reflects respondents’ assessment of the general economic situation over the next 12 months.
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