Germany’s GFk Consumer confidence data was released today showing a surprise rise from October going into November, October, indicating that German consumer morale is rising. One factor could be a strong labour market bolstered income.
Consumer confidence rose to 5.3 from a reading of 5.2 in the previous month, beating forecasts of a 5.1 increase, despite a darkening economic outlook. The Gfk survey was based on a survey of 2,000 Germans.
As unemployment fell much further than expected in September, according to recent data, this pushed the jobless rate to its lowest level in twenty years since the reunification of Germany. Falling unemployment boosted German consumer morale, which is indicated in the data today.
The Economy Ministry said last week growth would increasingly be sustained by domestic demand rather than exports, particularly in light of the robust labour market.
German unemployment will continue to fall next year, with the jobless rate dropping to 6.7 percent from 7 percent in 2011, the ministry said.
Germany’s economy has recovered swiftly from the financial crisis, outperforming its peers and providing a crucial growth engine for Europe.
Meanwhile, shortly after the German data, French consumer confidence data was also released, also showing a rise in the index from 80 to 82 in October, beating expectations for a drop in the reading to 79.
The euro is steady after the data, rising after the German data by 30 pips to 1.3923 but fell after hitting resistance and profit-taking ensued. The main focus is on the EU Summit tomorrow, which will be the main driver of the euro.