German consumer sentiment almost flat in April, GfK survey shows

        *
      Sentiment edges up to -24.5 points


        *
      First survey since Feb. 23 election


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      Willingness to save holding back improvement


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      Fast government formation needed, says analyst



       BERLIN, March 28 (Reuters) - German consumer sentiment
is broadly unchanged heading into April, with a focus on saving
highlighting uncertainty among  households after last month's
election in Europe's biggest economy, a survey indicated on
Friday.
    The consumer sentiment index, published by the GfK market
research institute and the Nuremberg Institute for Market
Decisions (NIM), inched up to -24.5 points from a slightly
revised -24.6 points the month before.
    Analysts polled by Reuters had expected sentiment to rise
to -22.7 points.
    While economic and income expectations and the willingness
to buy improve, a higher willingness to save is hindering a more
significant recovery, according to the survey.
    "The elections and prospect of a new government have
lessened pessimism among a number of consumers. However, the
renewed rise in the willingness to save is clouding the overall
picture," said Rolf Buerkl at the NIM.
    He said the attitude to saving was an expression of consumer
uncertainty and that a new government was needed to end that.
    "A fast formation of a government and the early adoption of
a budget for this year would be an important factor for more
planning security - not only for companies, but also for private
households," Buerkl said.
    Friedrich Merz's conservatives are in coalition talks with
the Social Democrats with the aim of getting a government in
place by or soon after Easter, at the end of April, although the
two are still at odds over several issues, including
immigration.
    Parliament last week passed plans for an overhaul of
Germany's tight fiscal rules and its biggest ever spending
package to revive a flagging economy and boost military
spending.
    However, any turnaround is likely to take time after the
economy shrank for a second straight year in 2024. It has lagged
other European economies over the last two years.
    Consumers' income prospects improved in March after two
straight declines but Buerkl said it was unclear whether this
marked an end the downward trend since mid-2024.
    Households' willingness to buy also increased but remains at
a low level and is worse than during the pandemic lockdowns, the
survey showed.

                                APR 2025  MAR 2025  APR 2024
 Consumer climate               -24.5     -24.6     -27.3
 Consumer climate components    MAR 2025  FEB 2025  MAR 2024
 - willingness to buy           -8.2      -11.1     -15.3
 - income expectations          -3.1      -5.4      -1.5
 - willingness to save          13.8       9.4      12.4
 - economic expectations         6.9       1.2      -3.1
 NOTE - The survey period was from February 27 to March 10,
2025.
    The consumer climate indicator forecasts the progress of
real private consumption in the following month.
    An indicator reading above zero signals year-on-year growth
in private consumption. A value below zero indicates a drop
compared with the same period a year earlier.
    According to GfK, a one-point change in the indicator
corresponds to a year-on-year change of 0.1% in private
consumption.
    The "willingness to buy" indicator represents the balance
between positive and negative responses to the question: "Do you
think now is a good time to buy major items?"
    The income expectations sub-index reflects expectations
about the development of household finances in the coming 12
months.
    The additional business cycle expectations index reflects
respondents' assessment of the general economic situation over
the next 12 months.

 (Reporting by Madeline Chambers; Editing by Kirsten Donovan)