PARIS: Consumer spending levels are declining in France, a trend that has proved particularly damaging for companies in the food and apparel sectors, new figures show.
INSEE, the official statistics body, stated that
household expenditure fell by 0.2% month on month in February. Analysts polled by Reuters had, by contrast, predicted the country would see an expansion of 0.4% on this metric.
The contraction also followed on from a dip of 0.8% logged in January, suggesting on-going challenges in the eurozone, and the stuttering domestic economic recovery, have dampened the popular mood.
According to INSEE, sales of food products witnessed a 0.4% contraction in February when compared with the previous month, and dropped by 3.1% on an annual basis.
Having registered an 11.5% decrease in January, demand for automobiles actually rose by 2.4% in February month on month, although this still marked a 3.4% decline year on year.
Elsewhere, household durables endured a slide of 0.9% in the second month of this year compared with the first, but bettered figures from February 2012 by 1.6%.
Clothing and textiles, however, recorded a 6.1% contraction month on month, and a 5.7% decrease in annual terms. Engineered products posted more modest losses of 0.9% and 1.6% on these measures respectively.
The French government is currently seeking both to raise taxes and cut public spending to curb the national debt, measures that are likely to continue to impact the economic climate in the long term.
Dominique Barbet, an economist at BNP Paribas, told the Wall Street Journal
: "There is no magic wand. You can't repair the public finances without hurting growth, which in turn limits the effect you can have on improving the deficit."
Data sourced from INSEE/Wall Street Journal; additional content by Warc staff