By Maria Martinez

German consumer sentiment is set to rise in June, recovering from the coronavirus shock, market-research group GfK said Tuesday.

GfK's forward-looking consumer-sentiment index is set to increase to minus 18.9 points in June from an upwardly revised minus 23.1 points for May. Economists surveyed by Dow Jones Newswires had forecast a score of minus 18.0 points for June.

Despite the increase, minus 18.9 is the second-lowest value that has ever been recorded for the GfK consumer climate in Germany, GfK said.

"Uncertainty among consumers is high," said Rolf Buerkl, consumer expert at GfK.

GfK uses data from three sub-indexes from the current month to derive a sentiment figure for the coming month, measuring economic expectations, income expectations and propensity-to-buy. In May, the three subcomponents are on a slight increase compared to April, GfK said.

Economic expectations rose to minus 10.4 in May after decreasing two months in a row, but this is still significantly below the longtime year average of around zero points.

In consumers' opinion, the German economy is far from being over the hump and they are anticipating a tough recession, Mr. Buerkl said.

"Anxiety over job losses remains high and has proven to be a key barrier to consumption at this time, alongside losses in income," Mr. Buerkl said.

Income expectations rose to minus 5.7 after a record loss in the previous month, when they dove to minus 19.3, but they remain 63 points below their value one year ago.

The propensity-to-buy measure benefited from improved income expectations and climbed to 5.5 points in May from minus 4.6 in April.

"The gradual opening of many businesses has certainly contributed to the propensity to consume not having to take any further hits, and increases even slightly at the present time," Mr. Buerkl said.

GfK said the improvement in the consumer climate is backed by a decrease in propensity to save, after a significant jump was recorded in April due to the high level of uncertainty.

Write to Maria Martinez at maria.martinez@wsj.com

(END) Dow Jones Newswires

May 26, 2020 02:14 ET (06:14 GMT)

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