FX.co ★ German Consumer Morale Hits 8-Month High

Germany's GfK Consumer Climate Indicator advanced to -20.6 as of May 2025, up from a slightly revised -24.3 in the previous period, surpassing market expectations of -26.0. This marks the highest level since August 2024, continuing the recovery that commenced in April. Income expectations surged to their peak since last October (4.3 compared to -3.1), while the willingness to purchase improved for the second consecutive month (-4.9 compared to -8.2). Likewise, economic expectations rose for the third month in a row (7.2 compared to 6.9). Conversely, the tendency to save plummeted significantly (8.4 compared to 13.8), suggesting a more optimistic consumer sentiment. Consumer expert Rolf Bürkl from NIM remarked that the adverse impacts of increased U.S. tariffs would likely be counterbalanced by the conclusion of coalition negotiations and the anticipated establishment of a fully operational government. "The future of the declining trend in the propensity to save remains uncertain and will undoubtedly hinge on the trajectory of trade conflicts between the U.S. and other global players," he noted.