GfK points to maintained strength in household consumption in Q2

The outlook for personal finances, however, edged down for the first time since November 2013, printing 3 in June, versus 6 in May, likely related to the muted wage growth we’ve seen so far.

Despite the relative pessimism on future finances, all in all, today’s positive outcome echoes improvements in the economic outlook and suggests solid consumption growth in Q2.

In our view, consumption spending is being supported by strong job creation, wealth effects from the recovery in the property markets and muted inflation pressures. We forecast household consumption to have grown 0.7% q/q in Q2 and expect it to rise by 2.5% and 2.3% in 2014 and 2015, respectively.

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The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.

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