German consumer confidence is expected to dip further next month over fears of unemployment, a key survey released today showed, but the chief pollster said this should not be interpreted as a foreboding of disaster, according to dpa. The Nuremberg-based GfK marketing group said consumers were saving instead of spending, because they worried that the job market would become tougher in the months ahead, and they also feared knock-on effects from Greece's deficit problems on the German economy. As a result, the consumer climate index will fall 0.1 points, which should equal a rating of 3.2 for March - the fifth consecutive decline. The index is based on monthly tracking of 2,000 respondents. GfK chief executive Klaus Wuebbenhorst said consumer confidence remained relatively steady. "One cannot say the crisis is over, but there is no need to paint a scenario of catastrophe either," he said in an interview. The news came a day after Germany, Europe's largest economy, recorded a slump in business confidence for the first time in 11 months, underlining that the recession is not quite over yet. The Ifo business confidence index, considered a major benchmark of the economic mood in Europe, declined on Tuesday to 95.2, after 10 consecutive monthly increases. Germany's 2009 budget deficit was also worse than expected, reaching 79.3 billion euros, according to figures released by the national statistics office. This represents new state debts amounting to 3.3 per cent of gross domestic product, pushing Germany over the 3-per-cent hurdle specified by the Maastricht treaty. The last time Germany passed that limit was between 2002 and 2005. Analysts had predicted the growing deficit due to falling tax income resulting from the economic crisis, coupled with the outlays of federal stimulus programmes and subsidies paid to employees working reduced hours.
