BERLIN — The consumer climate in Europe significantly improved in the first quarter of 2015, according to the the GfK’s Consumer Climate Europe study released Tuesday.
As Europe recovers from its financial and economic crisis, the Nuremberg-based market research group said consumers in western and southern Europe were particularly optimistic as the year took off. However, despite predominantly positive economic data, Eastern Europeans were more skeptical, reflecting the ongoing impact of the Ukrainian conflict and economic sanctions in Russia.
GfK noted all European countries recorded economic growth in 2014 and projections for 2015 have been revised upward in many European countries. This, combined with falling unemployment rates, the first effects of European market reforms, and lower oil prices, as well as stronger exports due to the weak Euro, have resulted in a rather upbeat consumer mood in the euro zone. For the 28 EU countries, GfK reported the overall consumer climate indicator rose by 4.3 points to 9.8 points in March 2015, the highest since April 2008.
The German market remains strong, with consumer confidence and economic expectations continuing to rise. GfK said, “Germans do appear to be actually spending money,” with the nation’s retail sector recording its strongest February sales in 15 years. However, as the German Retailer Association (HDE) also reported Tuesday, consumers have been making big ticket purchases like cars and houses, rather than spending on apparel and other items.
Most European consumers expect economic growth, but the outlook differs from country to country. The GfK said in the UK, consumers are ready to spend again, having money left over at the end of the month for the first time in years. In the Netherlands, the consumer mood is restrained despite encouraging economic data, as most Dutch consumers anticipate a fall in their wages.
France and Italy did not yet experience Europe’s positive trend, but consumers there nonetheless expect to benefit from pan-European growth soon, with income expectations and the willingness to buy on the recovery path. In Spain, economic expectations have never been so high, but most consumers remain hard-pressed. The same holds true in Portugal and Greece, where optimism is on the rise but most citizens’ willingness to buy and actual purchasing power remain extremely limited.
In contrast to most European countries, the Austrian economy is lagging, but willingness to buy improved in the first quarter. The outlook in Belgium, like the economy, remains restrained, but in Poland, the consumer mood has deteriorated despite encouraging economic data.