Fuel prices worry Germans

German consumers are less confident about spending going forward, as rising prices for gas and utilities are increasingly burning a hole in people's pockets.

The monthly GfK index of consumer confidence points to a 0.1-percent drop to 5.9 points for April, which would be the first fall since August 2011. Higher prices at the pump as well as higher utility bills were the main reason behind the dent in confidence.

"That's because these prices are very public." The GfK's Rolf Bürkl said on Tuesday. "You can see the prices constantly, driving past gas stations, see how they change."

Despite the drop, sentiment overall remained "largely stable," the survey said.

"In the short term, high oil prices will slow down the economy and that means consumption will slow," Christian Schulz from Berenberg Bank told the Reuters news agency.

Debt crisis relief

But he expects the German economy to remain healthy, not least because of solid domestic demand.

"What's important now is that the eurozone debt crisis is kept in check," he added.

Consumers are indeed more confident about steps to contain the crisis, the survey shows, but prolonged negotiations over pay in various sectors at home have led to some insecurity about disposable income in the near future.

The index is based on responses from around 2,000 households with regards to their expectations about pay and the economy as a whole in the coming months. GfK is a major market research company based in Germany.

ng/mz (dpa, dapd, AFP)