German consumer confidence holds steady despite slowdown - Summary

German consumer confidence holds steady despite slowdown - Summary Berlin - German consumer confidence is holding steady, a survey released Monday said, helped by hopes of an improving outlook for Europe's biggest economy and rising income expectations. The Nuremberg-based GfK marketing group said its forward-looking consumer confidence index for May came in at 2.5 points - compared to an upwardly revised April reading which was also 2.5 points.

This was despite forecasts of a dramatic slump in the German economy this year and the threat of escalating unemployment as companies lay workers off in the face of falling production and contracting orders.

Analysts had expected the GfK index, which is based on around 2,000 German households, would slip to 2.3 points in May.

"The consumer climate remains robust overall, despite an economic environment which is generally recessive," GfK said in a statement. "However, the index remains at a very low level."

The index comes on the back of some forecasts that the global economy could start to emerge from the current downturn towards the end of the year.

It also comes in the wake of bigger-than-expected rises in both a key German business climate index and an investor confidence report.

A breakdown of the GfK survey for April showed German consumers' economic expectations rose to minus 31.2 from minus 32.8, while income expectations increased to minus 8 from minus 11.4 as falling inflation helped to underpin the mood in the nation's households.

However, underscoring the current economic uncertainty, the survey said consumers' propensity to spend declined to 12.4 from 13.9. (dpa)