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Consumption

Germans still spending despite economic concerns

Consumer confidence in Germany is set to remain stable into October, a market research group has found, as people prefer to spend their money rather than save it. But sluggish economic growth is having a negative effect.

Germany's forward-looking consumer confidence index has remained steady at 5.9 points for October, which was the same reading as for the month of September, the market research firm GfK announced Tuesday.

The headline indicator, which is based on responses from about 2,000 German households, had stabilized at a high level after recording 5.8 points in August, the GfK announced.

Against the background of the eurozone debt crisis, Germans are more inclined to invest their money in material goods rather than save it in bank deposits, according to the GfK. As a result, their willingness to spend had improved in September.

Nevertheless, expectations about any further improvement in personal income dropped for the third consecutive month, as confidence in Germany's economic development has remained flat.

The GfK report noted that Germans' fear of the economy sliding into recession had at least abated this month, although much uncertainty about the future prevailed.

The GfK maintained its outlook for German domestic consumption to rise by about 1 percent in 2012.

uhe/pfd (AFP, dpa)