The coronavirus crisis has not yet had a negative impact on the payment morale of German consumers. Helmut Schleweis, president of the German Savings Banks Association, told DPA. He also pointed to the growing rate of savings.
“Currently, we do not see any extraordinary development in the repayment of loans or in the use of overdrafts,” said Schleweis. “People are taking precautionary measures. Some expenses, such as travel, are limited by pandemics, “he added.
Consumer confidence in Germany fell to a record low in the spring due to concerns about the negative economic impact of the covid-19 pandemic, but then recovered. According to the GfK institute, the consumer mood index for October rose to minus 1.6 points from minus 1.7 points in September. It was thus high above the May minimum near minus 23 points.
GfK researcher Rolf Bürkl said in the publication of the October index value that consumer sentiment in Germany has stabilized despite the current rise in new cases of coronavirus infection and the growing threat of new restrictive measures.
“It seems that far-reaching measures to support consumers and businesses are the right steps to help Germany recover from the worst recession in post-war history,” he added.
The German government has introduced a number of measures to mitigate the negative effects of the coronavirus crisis on the economy. For example, it decided to reduce value added tax (VAT) for half a year and provide families with a one-off contribution of EUR 300 (approximately CZK 8,000) for each child.
The German economy contracted by a record 9.7 percent in the second quarter due to the coronavirus crisis. However, the Ifo Institute estimates that gross domestic product (GDP) grew by 6.6 percent in the third quarter.
The statistical office will publish a quick estimate of GDP development for the third quarter at the end of October. Germany is the largest economy in Europe and the largest trading partner of the Czech Republic.