Europeans set to spend more

German market research company GfK said Wednesday it expected private consumption in the 28-member European Union to rise by 1 percent to 1.5 percent in 2015.

Presenting its annual outlook, the group penciled in a 1.5-percent increase in consumption in Europe's economic powerhouse.

This is in line with the predictions of the government in Berlin and some economic think tanks, which also forecast a 1.5-percent expansion of Germany's gross domestic product (GDP).

Spending patterns

The research group said its poll had shown Germans were willing to spend a lot more this year against the backdrop of a robust domestic labor market and rising wages in many industries.

GfK chief Matthias Hartman warned, though, that retailers were unlikely to profit from any spending sprees this year as Germans were prone to put their money into real estate and travel activities rather than on goods and services.

GfK's Consumer Climate Europe study noted the improved outlook for this year came on the back of 1.1-percent growth in German consumption in 2014 when geopolitical crises persisted.

It added that there were more risks now that might hamper economic development over the coming months, expressing fears that the newly elected government in Greece may not stick to debt-servicing agreements with its main creditors.

hg/pad (Reuters, GfK)