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German consumer confidence at 13-year high

Created: 01/28/2015 6:52 AM
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BERLIN (AP) — German consumer confidence is at a 13-year high, buoyed by a rise in disposable income due to collapsing fuel and heating oil costs, a closely-watches survey showed Wednesday.

The GfK research group said its forward-looking consumer climate index rose to 9.3 points for February from 9 points the month before.

GfK says dropping energy prices have driven 'considerable increases in both income expectations and willingness to buy." Consumers also regard the lower fuel prices as a key economic stimulus which, combined with a drop in the euro's value, "should boost not only exports but also companies' willingness to invest."

The survey of some 2,000 consumers showed economic expectations rose to 22.5 in January from 14.5 points in December, income expectations up to 47.8 from 41 and willingness to buy up to 57.4 from 49.1.

The report came as the German government raised its GDP growth forecast for 2015 to 1.5 percent from the 1.3 percent it had predicted last year.

Chancellor Angela Merkel's spokesman Steffen Seibert said Germany's robust labor market was one of the main causes behind the increase.

Germany's economy, Europe's largest, grew by 1.5 percent last year thanks to increasingly strong spending at home and healthy exports.

It made a fast start last year before contracting slightly in the second quarter and returning to slight growth in the summer.

Germany was able to do without new borrowing last year — a year earlier than planned — for the first time since 1969.

(Copyright 2015 by The Associated Press. All Rights Reserved.)

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