The European economy has registered a new decline of the consumer propensity to buy indicator, which describes the economic expectations and also the consumer’s earning prospects during the third quarter of this year, according to the market research institute Gfk. In comparison with the previous quarter results (9.1 points), Europe’s consumer confidence index for the EU 28 has dropped to 4.2 points.

This study points out various relevant international facts that may explain this lower consumption rate in the EU. Firstly, the slowdown of Germany’s export business within the EU as well as to emerging markets such as Russia, China or Brazil, combined with weak growth rates. In addition, the structural problems in France and Italy joint to the apparent lack of structural reforms implemented by their respective governments. Secondly, the low rate of inflation in most European countries and even deflation in some markets, which are causing consumer prices to fall.

Another reason for consumption’s drawback are the many international conflicts that are dominating the foreign policy agenda: the friction and economic sanctions between the EU and Russia; the war in the Middle East; the threat of the Islamic State and the remodeling politic in Turkey. Not only do all these events alienate the population but also companies and financial institutions, who slow down investments and credits respectively.

The results of the GfK Consumer Climate Europe are gathered from a consumer survey, which is conducted in all the EU countries on behalf of the EU Commission. 40,000 people, representing the adult population, are surveyed every month in the 28 EU member states.