The German consumer climate index fell to 5.3 points in January from 5.5 in December, according to a monthly survey by GfK market research. The January reading fell short of GfK's forecast of 5.5 points. GfK said it forecasts the overall climate index to fall to 5.0 points in February. "From the point of view of consumers, 2004 got off to an icy start," GfK said. "Apparently the tax reforms decided in mid-December didn't give consumers the clarity they had hoped for with respect to their future financial situation," it added.
Gfk also said that uncertainty generated by the discussion around economic and social reforms was weighing on sentiment. GfK said the sub-index measuring consumers' income expectations fell 6 points in January to minus 14.5. The sub-index measuring consumers' willingness to spend fell 9.5 points to minus 41.7 points. The economic expectations index, which measures consumers' optimism about the economic outlook, fell 4.2 points to minus 5.8. The GfK consumer climate survey polls 2,000 people and is carried out on behalf of the European Commission. //www.fxcentre.com