French household spending rises in January

24th February 2004, Comments 0 comments

PARIS, Feb 24 (AFP) - French household spending strengthened by two percent in January after remaining unchanged in December, with seasonal sales again boosting the figures, the national statistics INSEE and analysts said Tuesday.

PARIS, Feb 24 (AFP) - French household spending strengthened by two percent in January after remaining unchanged in December, with seasonal sales again boosting the figures, the national statistics INSEE and analysts said Tuesday.

The INSEE statistics office had initially shown spending rising in December by 0.2 percent.

On a 12-month basis, spending also increased by two percent, INSEE said.Analysts pointed to the seasonal effect of January sales, which pushed consumption of fabrics and leathers up by 9.5 percent on a monthly basis.

Purchases of automobiles, meanwhile, fell sharply, losing 4.5 percent in January after a gain of 2.6 percent the previous month, INSEE said.

Household equipment purchases grew by 2.7 percent.

Marc Touati of Natexis Banques Populaires noted that the positive effect of sales was less pronounced this year than in previous years.

But, he reasoned, "compared to the morose consumer climate in Germany and The Netherlands, France's performance is an exception within the the eurozone, along with Greece and Spain, obviously".

Touati urged officials to take a long look at the figures, saying: "If it is indispensable to underpin the offer, i.e. businesses, to get them to invest, produce and hire in France, it is just as important to support consumption."

According to Emmanuel Ferry of the Exane brokerage, however: "In no case can consumption constitute a catalyst for a rebound in (economic) activity."It is at best a component which gives the French economy a defensive character."

At Natexis Asset Management, Philippe Waechter said: "The progress in January (plus two percent) shows the heretofore volatile character of household spending.

"We perceive a very marked cyclical nature linked to sales."

© AFP

                                                              Subject: France news

 

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