Further improvement in German consumer morale could be short-lived due to extended lockdown

German consumer morale improved for the second consecutive month, the report from Gfk research institute showed on Thursday.

Consumer sentiment index rose to -6.2, the best result since November, from a revised -12.7 in March and also came well above expectations at -11.9.

Easing lockdowns at the beginning of March boosted consumer morale, with the main components of the index such as willingness to buy and income expectations, registering strong increase from the previous month, but remained well below levels seen a year ago.

The income expectations rose to 22.3 in March from 6.5 in February, reflecting expectation for wage rise in 2021, but the numbers stay below the result of March 2020 at 27.8.

The willingness to buy indicator which represents the balance between positive and negative responses to the question: ‘Do you think now is a good time to buy major items?’, climbed to 12.3 from 7.4 in February, compared to 31.4 in March last year.

The upbeat results came as the survey took place between Mach 3-15 period, before Germany extended its lockdown until April 18 that may cloud the outlook.