By Emese Bartha
FRANKFURT--German consumer confidence is set to start the new
year on a strong note, hitting its highest level in eight years, on
hopes economic expansion in Europe's largest economy will
accelerate in the coming months, a sentiment survey showed
Friday.
The monthly survey by the GfK market research group shows
consumer confidence rising to 9.0 points for January from 8.7
points in December. That is above economists' forecast of 8.8
points, according to a Wall Street Journal survey. The last time
the survey's reading was higher was in December 2006 when it hit
9.1 points.
"Consumers assume the economic weakness in Germany is only
temporary and the domestic economy will return to the growth path
in the next few months," GfK said in a statement.
GfK uses survey data from the current month to derive a figure
for the month to come.
Consumers' economic expectations and willingness to buy improved
in December, as sharply lower energy prices gave households some
flexibility in making purchases. Consumers' income expectations
worsened, however, which GfK said could be explained by the
unstable international situation rather than domestic
circumstances.
"By his standards, the German consumer is shopping a lot," said
Holger Sandte, chief European analyst at Nordea, adding that
domestic demand will remain the main driver of economic growth next
year.
Other recent economic indicators also suggest Germany is
emerging from a period of weakness. Business confidence improved
for the second consecutive month in December, the Munich-based Ifo
institute's key indicator showed Thursday.
Write to Emese Bartha at emese.bartha@wsj.com