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UK Confidence Creeps Up as German Consumer Mood Plummets

Rising energy costs plus higher inflation are pushing households to save more and threaten to undo fragile spending gains

Overview

  • GfK’s UK consumer confidence index rose one point in September to minus 13, marking the first time since summer 2024 that the measure has logged three straight monthly gains.
  • The Nuremberg Institute/GfK consumer climate for Germany fell sharply to minus 30.6 for October, driven by a 16.7‑point drop in income expectations to minus 15.0 and a jump in saving intent.
  • German households’ willingness to save climbed to 21.5, the highest level since the 2008 financial crisis, as most respondents said high energy prices will cut their purchasing power.
  • Analysts warn that rising energy and recent upticks in inflation are the common cause of weaker sentiment and that each one‑point move in these indices roughly equals a 0.1% change in year‑on‑year private consumption.
  • The split outlook raises risks for economic policy because weaker consumer spending could slow growth while persistent energy‑price pressure may prompt central banks to consider tighter interest rates.