Germans have been known for living up to the stereotype of being a bit stingy when it comes to spending their money, often opting to put any extra income away for a rainy day. In 2010 Germans ranked 2nd, falling just behind the Chinese, with a savings rate of 15 percent of their income. Five years later, however, the trend is quickly reversing.
According to a recent report by the German Society for Consumer Research (GfK), spending is at a 13-year high as Germans find more confidence in their economy and job security. The 15 percent saving rate seen just five years earlier has dropped into the single digits, reaching just about nine percent.
Economic confidence isn’t the only contributing factor though. With a base interest rate of only 0.05 percent being offered by the European Central Bank, more Germans are not seeing the value in putting all of their money into savings. And despite a stock market boom, most Germans avoid putting any money into stocks.
So with the weaning desire to put their money away, Germans are deciding to spend it. While this trend reversal may sound dangerous, there is some benefit to German spending hitting an eight-year high.
Rolf Bürkl, market researcher at GfK, told DW that he believes that the “increase in consumption also helps other countries affected by the economic crisis, as it boosts German imports of goods from other nations”.