German consumer confidence is set to continue its upward move in July, reflecting Germans' positive view of the economy and of their own finances, GfK market research group's monthly survey showed on Thursday.
GfK's forward-looking consumer sentiment index is set to rise to 10.6 points "in a clear uptrend" in July from 10.4 points in June, GfK said. Economists in The Wall Street Journal's survey expected a 10.4 point reading.
Continue Reading Below
The research institute also confirmed its forecast for real private consumer spending to grow by around 1.5% in 2017, provided, however, that Germany is spared from any larger external shocks.
The strong German consumer confidence reading follows French consumer confidence data, published on Wednesday, which jumped to its highest level in 10 years in June. Also German business sentiment hit a record high level in June, the Ifo institute said earlier this week.
GfK uses three sub-indexes for the current month to derive a sentiment figure for the next month.
The economic expectations sub-index rose to 41.3 points in June from 34.8 points, the fourth rise in a row, hitting the highest level since July 2014, GfK said.
"Consumers believe that the boom in Germany is gaining traction despite global economic risks," GfK said, adding that a weak euro, low oil prices and the European Central Bank's expansive monetary policy ensure that the economic engine continues to gain pace.
The income expectations sub-index increased to 60.2 points from 58.5 points, hitting the highest level since German reunification. This upward move is supported by the strength of the German labor market, with the number of people in employment expected to rise by more than half a million this year, GfK said.
The propensity to buy sub-index, which reflects consumers' intention to buy big-ticket items, increased to 57.9 points in June from 55.7 points in May.
Write to Emese Bartha at email@example.com
(END) Dow Jones Newswires
June 29, 2017 02:14 ET (06:14 GMT)