Luxembourg shoppers halt spending spree as confidence chills
Luxembourg consumers felt less confident in August than at any point since the summer of 2020, a survey by the country's central bank found on Wednesday, as prices continue to soar and the cost-of-living crisis intensifies following Russia’s invasion of Ukraine.
The Luxembourg Central Bank’s consumer confidence indicator fell further in August after gradually dropping over the summer months and was 24 percentage points lower than a year ago, the report showed.
People were much less likely to go on a major spending spree in August than during the peak of the pandemic, according to the latest survey from the Luxembourg Central Bank.
Prices for goods such as fuel have sky-rocketed since Russia launched its attack on Ukraine, hitting record highs across Europe.
The 19 countries that use the euro currency saw a 9.1% rise in consumer prices in August compared to a year earlier, driven by energy prices climbing at a 39% rate, the EU’s official statistics agency Eurostat said on Wednesday.
EU countries have agreed to decrease gas consumption by 15% from August until March - on a voluntary basis - as energy prices soar and the European Commission said earlier this week it was planning emergency steps in a bid to dampen power costs.
Consumers’ expectations of the Luxembourg economy improved slightly compared with July and were four percentage points better than in March, immediately after the war began. However, the outlook in recent months has remained much more pessimistic than throughout last year.
People had a slightly worse perception of their own financial situation in August compared to a month earlier, although their outlook had improved marginally since March, the study showed.