German consumer confidence will stay close to the highest in more than three years as unemployment declines in Europe’s largest economy, GfK AG said. The Nuremberg-based market research company said today that its consumer sentiment index, based on a survey of about 2,000 people, will slip to 5.4 from 5.5 in December. That was the highest since October 2007. Economists forecast a gain to 5.7, the median of 22 estimates in a Bloomberg News survey showed. German households are stepping up spending as companies boost hiring and output to meet global orders. Unemployment fell for a 17th month in November and retailers forecast further sales gains after a “dream start” to the end-of-year holiday season, the German Retail Federation said on Nov. 29. “Sentiment remains stable,” GfK said in the e-mailed statement. “Consumers believe the German economy is well on course for recovery even if they think the unusually strong momentum over recent months cannot be fully maintained.” GfK’s indicator of households’ economic expectations fell to 58.8 in December from 65.8 in November. A gauge of income expectations declined to 40.3 from 44.9, and an index of consumers’ willingness to spend decreased to 33.8 from 39.3. While the pace of economic expansion slowed to 0.7 percent in the third quarter from a record 2.3 percent in the second, private consumption was one of the main growth contributors. Germany’s Bundesbank said on Dec. 13 that the economy probably showed a “further robust expansion” in the current quarter. To contact the reporter on this story: Gabi Thesing in London at gthesing@bloomberg.net To contact the editor responsible for this story: John Fraher at jfraher@bloomberg.net

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