Morale among German consumers declined for the third month in a row heading into November as an influx of refugees into the country raised households' concerns that unemployment will rise, market research group GfK said today.
The GfK consumer sentiment indicator, based on a survey of 2,000 Germans, fell to 9.4 points heading into November from 9.6 points a month ago.
This was its lowest reading since 9.3 in February and the figures were in line with the Reuters consensus forecast.
German consumers' economic concerns grew markedly, with the sub-index for economic expectations declining sharply to -2.9 points from 6.4 points, slipping below zero for the first time since May 2013 and hitting its lowest since January 2013.
"The downward trend in the economic outlook goes hand in hand with the concern felt by many German citizens that the situation in the labour market will worsen in the coming months," GfK said.
GfK examined the reasons for the anxiety about unemployment.
The results were unequivocally clear, as 70% of respondents who believe that unemployment will increase over the next few months cited the refugee crisis as the primary cause for their concerns," said Buerkl.
Germany is taking in more migrants than any other EU state. It expects 800,000 to 1 million people, many from war zones in the Middle East, Africa and Afghanistan, to arrive this year.
Meanwhile, consumers' income expectations were steady on the month but their willingness to buy fell to the lowest in a year.
"Future consumer sentiment will predominantly depend on whether the uncertainties currently surrounding the progression of the labor market continue to intensify," the group said.