October 26, 2017 / 6:04 AM / a year ago

TABLE-German consumer morale dips heading into November

    BERLIN, Oct 26 (Reuters) - The cheerful mood among German
shoppers clouded slightly for the second month in row heading
into November, a survey showed on Thursday, providing further
evidence that a consumer-led upswing was losing steam.
    Household spending has overtaken exports as the main source
of economic expansion in Germany as consumers benefit from
record-high employment, increased job security, rising real
wages and low borrowing costs.
    The Nuremberg-based GfK institute said its consumer
sentiment indicator, based on a survey of around 2,000 Germans,
edged down for the second month in a row to 10.7 points going
into November from 10.8 in the previous month. The Reuters
consensus forecast was 10.8.
    GfK researcher Rolf Buerkl said the main reason for the
softening of consumer sentiment was a slight reduction in income
expectations. "The topic of inflation seems to be currently of
greater concern to consumers," Buerkl said.
    GfK's sub-index measuring income expectations fell to 48.7
points from 52.7 in the previous month. However, consumers'
willingness to buy rose 2.2 points to 59.2, indicating they
remained willing to buy.
    But Buerkl cautioned that tricky talks on a governing
coalition may weaken consumer demand. 
    "If there were to be a protracted deadlock situation, this
would probably unsettle some consumers," Buerkl said.
    Chancellor Angela Merkel's Christian Democrats, their
Christian Social Union allies, the liberal Free Democrats and
the Greens are negotiating to form a coalition after an election
last month.
                                 Nov 17    Oct 17    Nov 16
 Consumer climate                10.7      10.8      10.0
 Consumer climate components     Oct 17    Sept 17   Oct 16
 - willingness to buy            59.2      57.0      49.9
 - income expectations           48.7      52.7      44.8
 - business cycle expectations   43.5      33.4      13.0
    NOTE - The consumer climate indicator forecasts the 
development of real private consumption in the following month. 
    An indicator reading above zero signals year-on-year growth 
in private consumption. A value below zero indicates a drop 
compared with the same period a year ago. 
    According to GfK, a one-point change in the indicator 
corresponds to a year-on-year change of 0.1 percent in private 
    The "willingness to buy" indicator represents the balance 
between positive and negative responses to the question: "Do you
think now is a good time to buy major items?" 
    The income expectations sub-index reflects expectations 
about the development of household finances in the coming 12 
    The additional business cycle expectations index reflects 
the assessment of those questioned of the general economic 
situation in the next 12 months. 

 (Reporting By Riham Alkousaa, editing by Larry King)
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