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Rising Wages Boost Consumer Confidence

Danish consumers have become more optimistic about the economy, especially regarding their family’s financial situation and the country’s economic status. Statistical indicators from December to January show a significant increase in consumer confidence, from -13 to -8.4, the highest level since February 2022. The chief economist at Sydbank, Søren Kristensen, attributes this optimism to wage increases outpacing inflation, rising employment, and housing prices. Consumer confidence is measured on a scale from very positive to very negative and translates these responses into a numerical value between -100 and 100. Despite the negative value, it indicates that consumers do not view the economy through rose-colored glasses, as real wages have grown less compared to previous years, making them effectively poorer. Consumer confidence has been below zero since October 2021, with a low of -37 in October 2022, when inflation peaked, having risen 10.1 percent over the year.