ECB moves boost German consumer confidence

Wednesday 25 June 2014 07.31
GfK's headline household confidence index was forecast to rise to 8.9 points in July from 8.6 points in June
GfK's headline household confidence index was forecast to rise to 8.9 points in July from 8.6 points in June

Consumer confidence in Germany is rising again, buoyed by the European Central Bank's recent decision to cut interest rates, a new poll found today. 

Earlier this month, the ECB rolled out an unprecedented package of measures, including negative interest rates and targeted measures to kickstart lending to businesses. 

"The cut in rates by the ECB and the decision to charge banks for parking their money at the bank has given the consumer climate an extra boost and is the main reason behind the rise in consumer confidence," market research company GfK said in a statement.

"These decisions have hit Germans' propensity to save. And the increase in their willingness to spend money is also partly attributable to the ECB moves," it said. 

Looking ahead to next month, GfK's headline household confidence index was forecast to rise to 8.9 points in July from 8.6 points in June. For the past four months, the index has stagnated. 

The survey is based on responses from about 2,000 households regarding their expectations about pay and the economy as a whole in the coming months, as well as their willingness to spend money. 

Sentiment in Europe's top economy is currently positive, but appears to be stalling amid uncertainty about possible fallout from the crises in Ukraine and Iraq. Earlier this week, the Ifo business climate survey fell more than expected.