German consumer confidence is set to drop at the start of the year 2026 as rising inflation fears weigh on income expectations and purchase decisions, monthly survey data published jointly by NIQ/GfK and the Nuremberg Institute for Market Decisions showed Friday.
The forward-looking consumer confidence index fell to -26.9 in January from revised -23.4 in December, missing the expected score of -23.0.
In December, economic expectations stagnated, while income expectations and willingness to buy declined. The willingness to save increased significantly by five points to 18.7, which was the highest since June 2008.
“The return of uncertainty due to rising inflation fears and controversial discussions about the future of pensions have certainly contributed to this 17-year high in the savings indicator,” NIM Head of Consumer Climate Rolf Burkl said.
“This is not good news for the final sprint in this year’s Christmas business and can also be seen as a false start for Consumer Climate in 2026,” said Burkl.
Income expectations weakened in December, largely due to the rise of inflation fears among consumers. The income expectations indicator dropped for the third straight month to hit the lowest since January 2024. The corresponding index posted -6.9, down from -0.1 in November.
After two consecutive increases, willingness to buy dropped in December. In the wake of falling income prospects, the willingness to buy index dropped 1.5 points to -7.5.
Nonetheless, economic expectations showed resilience despite falling income expectations and the slight drop in willingness to buy. The index climbed 2.3 points to 1.2 in December.
Experts expect the German economy to expand 1 percent or slightly less in 2026.
The survey data was collected by GfK between December 4 and 15 among 2,000 consumers.
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