German consumer confidence is set to decline sharply to the lowest in more than a decade in April as the increase in the number of coronavirus infection cases and the accompanying measures made consumers to take cautious approach, survey data from market research group GfK showed Thursday.
The forward-looking consumer confidence index fell to 2.7 from 8.3 in March. The score was forecast to fall moderately to 7.7 from March's initially estimated value of 9.8.
At 2.7 points, the score reached its lowest level since May 2009. During the financial and economic crisis, the consumer climate index was at 2.6 points.
"In light of the current development, we are withdrawing our consumer forecast of one percent growth for 2020," Rolf B?rkl, GfK consumer expert said. "Retailers, manufacturers and service providers must prepare for a recession."
All components of the indicator, namely economic and income expectations and propensity to buy, suffered dramatic losses in March.
The economic expectations index fell by 20.4 points to -19.2, which was the lowest since August 2012.
The largest euro area economy has come to a complete halt after the wide spread of the coronavirus and the associated restrictions. Fear of job losses also increased significantly in a very short period of time.
Consequently, the income expectations indicator plunged 13.4 points to 27.8, its lowest level in exactly seven years.
Likewise, the propensity to buy indicator slid 22.2 points to 31.4 points in March. A lower figure was last recorded in June 2013. The survey was conducted between March 4 and 16.