German consumers defy global trade conflicts
BERLIN, June 28 (Xinhua) -- German consumer sentiment will hold steady in July in spite of growing headwinds from trade conflicts experienced in the eurozone's largest economy, according to a study published on Thursday by the GfK market research institute.
The Nuremberg-based institute for market research predicted that its consumer sentiment barometer would remain unchanged at the previous month's level of 107.7 points in July, halting the downward trend recorded in last two months.
The findings were based on a regular survey of around 2,000 respondents.
The GfK noted that a swelling trade conflict between the European Union (EU) and the United States was weighing negatively on consumer sentiment as expectations for future economic growth fell. However, the effect was offset by rising domestic wages and a related increase in the willingness of private households to commit to larger purchases.
The study warned that while there were still "excellent domestic framework conditions" concerning employment and wages, a further rise in inflation could erode these benefits and undermine spending. According to official figures, consumer prices rose by 2.1 percent in June.
Given an anticipated weakening of global economic momentum generally, GfK revised its forecast for consumption down from a growth rate of 2 percent to 1.5 percent. Aside from trade conflicts and inflation, the institute identified an escalation of current conflicts in the EU over asylum policy as posing a major risk to consumer sentiment.