FRANKFURT--Germany's reluctant consumers will enter 2014 on a high, the country's leading market research firm said Friday, as household sentiment hit a fresh six-year high, surpassing economists' forecasts.
GfK's forward-looking consumer sentiment indicator rose to 7.6 points in January from 7.4 points in December, which is the highest level since August 2007.
"The consumer climate is off to a good start in 2014," indicating that domestic demand will remain a key driver of economic growth, GfK said in its monthly survey of roughly 2,000 German consumers.
While the main indicator refers to the month ahead, all sub-indicators refer to the current month.
German households are growing increasingly optimistic about the economic outlook, the survey found, as the corresponding GfK indicator rose for the fourth consecutive month, hitting its highest level since July 2011.
But that wasn't enough to give income expectations another leg up. The corresponding GfK indicator slipped 5.7 points to 39.5 points in December, but remained significantly above the level recorded last December.
GfK said that some consumers fear that they will have to pay for the welfare measures planned by Germany's new government, such as changes to the pension system.
Consumers' willingness to spend, meanwhile, hit a fresh seven-year high ahead of Christmas.
Germany's retail association HDE expects that Christmas sales will be up 1.2% from the same period last year. Adjusted for inflation, this means they will stagnate at best or, more likely, drop since HDE estimates that German retail prices will rise 1.5% on average this year.
Write to Nina Adam at nina.adam@wsj.com
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