Upbeat consumers underpin economic growth

28th June 2007, Comments 0 comments

PARIS, June 29, 2007 (AFP) - Consumer spending helped the French economy expand by 0.5 percent in the first quarter of 2007, data released Friday by the national statistics institute INSEE showed.

PARIS, June 29, 2007 (AFP) - Consumer spending helped the French economy expand by 0.5 percent in the first quarter of 2007, data released Friday by the national statistics institute INSEE showed.

Household confidence, meanwhile, improved further in June to an indexed minus 12, its best level since 2002, a separate INSEE statement said.

With economic growth set to continue throughout 2007, the government's full-year target of 2.25-2.5 percent appeared to be well within range.

On Thursday, Economy Minister Christine Lagarde told RTL radio: "It is indispensable that through competition and flexibility and within a framework of reinforced (economic) security, we can increase the rhythm of French growth.

"We want to get an additional (percentage) point of growth," she said, noting that "today we are about a point below most equivalent European countries."

Consumer spending contributed 0.3 points to the total growth figure, INSEE said.

France's foreign trade balance was essentially neutral, with the increase in imports roughly equivalent that of exports.

Meanwhile, French household confidence improved in June as the French deemed that their standard of living had increased in recent months and that their personal financial situation had also improved.

But many did not feel that would continue to be the case in the coming months, and a sub-index on the short-term trend that had risen sharply in May fell back in June.

The French were also less optimistic about the near-term perspectives for their personal finances.

An increasing number nonetheless felt the time was right to make important purchases, which augured well for consumption figures to come.


Copyright AFP

Subject: French news

0 Comments To This Article