BERLIN (AP) -- German consumer confidence slipped unexpectedly in June, as rocketing gasoline prices and other cost increases caused consumers to worry about their purchasing power, according to a closely watched survey Tuesday, while analysts warned of a possible economic slowdown.
The GfK consumer climate survey dropped to 4.9 points for June from a 5.6 reading in May -- downwardly revised from 5.9 -- the Nuremberg-based agency reported. Analysts polled by Dow Jones Newswires had predicted the index to come in at 5.8 points.
''Rising inflation in May of this year has clouded the mood among consumers,'' the agency said in a statement. ''The economic outlook indicator, income expectations and the propensity to buy all suffered considerable losses.''
The agency pointed to record high gas prices and other price increases, combined with a weak global economy, as giving rise to worries for consumers in Germany, Europe's largest economy.
''Concerns about price stability and uncertainty resulting from the crisis on the financial markets and the flagging U.S. economy are currently fueling economic fear among German consumers,'' the agency said. ''This has resulted in the economic downturn becoming somewhat more pronounced than at the beginning of the year.''
All three of GfK's subindexes, which refer to current conditions, also fell.
The index that measures economic expectations dropped to 13.4 points in May from 23.3 points in April. The index showing income expectations fell to minus 4.3 points from 10.5 points in April. The index showing consumers' consumption and propensity to buy fell to minus 20.4 points in May from minus 4.7 points in April.
Alexander Koch, an economist with the UniCredit group, said the survey indicated the German economy is facing an uphill battle this year.
''The strong start of the German economy into 2008 cannot disguise the increasing headwinds for the German economy, and above all the German consumer,'' said Koch, whose organization had predicted a 6.2 reading for June.
Germany's Federal Statistics Office on Tuesday confirmed preliminary numbers showing that economic activity surged forward in the first quarter, propelled by construction and corporate investment. GDP rose 1.5 percent on the quarter, after a 0.3 percent gain in the fourth quarter of 2007, while the annual growth rate rose to 2.6 percent from 1.8 percent on the fourth quarter.
But experts warned that the underlying data did not point to the rise being sustained through the year.
Among other things, household spending rose 0.3 percent on the quarter, adding 0.2 of a percentage point to the quarterly growth -- but the GfK report suggests that there may be weakness ahead.
Additionally, a mild winter helped construction spending, which gained 4.5 percent on the quarter, after declining 0.5 percent in the October to December period.
A strong buildup in inventories also contributed 0.7 percentage point to GDP growth, according to the report.
''Germany's economic growth will be much slower during the remainder for 2008 and may easily be negative in quarter-on-quarter terms during the second quarter if the unwinding of the construction surge, related to the seasonal adjustment process, combines with de-stocking and quite possibly a fresh setback for consumer spending,'' said Timo Klein, an analyst with Global Insight in Frankfurt. ''Little help should be expected from net exports as exports are now on a weakening trend due to faltering Eurozone demand and a very strong euro.''
Andreas Rees, with UniCredit, said that a spring setback is ''inevitable,'' pointing to the one-off effects of the first quarter.
''Exceptionally mild winter temperatures led to a frontloading of building activity ...'' he said. ''Given the surging oil prices, the rise in consumer expenditures is absolutely not sustainable.''
Still, he said the first quarter's 4 percent rise in investment in machinery and equipment, compared to a 3.4 percent gain in the previous quarter, indicated a ''robustness of German companies'' that gave reason for hope.
''Despite the fizzling out of tax deductions at year-end 2007 and turbulence on financial markets, they continued investing at breakneck speed,'' he said. ''As a matter of fact, it was the eighth consecutive rise, suggesting that managers do not believe in an abrupt slowdown in industrial activity.''
