By Ed Frankl
German consumer confidence rose to its highest level since May 2022, suggesting the country's economy may have turned a corner, following similar more upbeat sentiment among businesses published earlier this week.
The forward-looking consumer-climate index for Germany, published Thursday by research group GfK and the Nuremberg Institute for Market Decisions, forecasts confidence to rise to minus 24.2 in May from minus 27.3 this month.
The reading, the third-straight rise in the index, was a little better than economists' expectations of minus 26, according to a poll compiled by The Wall Street Journal.
The stronger increase in consumer sentiment compared to the prior two months was mainly due to a boost in income expectations, Rolf Buerkl, consumer expert at NIM, said.
"Rising wages and salaries combined with a recent decline in the inflation rate form the foundation for increasing purchasing power among private households," he said.
The survey's gauge of willingness to buy also increased, though so did consumers' willingness to save, suggesting uncertainty among Germans in the economic outlook.
While overall sentiment has improved, it remains at a subdued level, with a sustained economic recovery still obscured from view. The German government said Wednesday that it expects the economy to grow just 0.3% in 2024.
However, surveys of businesses improved in data released earlier this week, including the closely watched Ifo index, suggesting that the economy may be tentatively bouncing back.
Write to Ed Frankl at edward.frankl@wsj.com
(END) Dow Jones Newswires
04-25-24 0214ET
