French consumer confidence rose for the first time in more than a year in September as falling fuel prices left people with more to spend on food and clothing. The monthly consumer confidence servey carried out by the national statistics office came in with a reading of minus 44, up from a revised record-low of minus 47 in July, the last month for which the survey was held.
The price of oil has now fallen by around a third from its record in July. Still, crude remains at more than $100 a barrel and is 33 percent higher than a year ago, while the continuing crisis in global financial markets may act as a constraint on consumers' ability and willingness to spend in coming months.
Thus despite the uptick in confidence French consumer spending on manufactured goods actually fell in August. Household spending on manufactured goods, which accounts for about 15 percent of the French economy, fell 0.3 percent from July, when it rose 0.4 percent, according to data from Insee. From a year earlier, spending declined 0.1 percent.
The French economy shrank 0.3 percent in the second quarter, the first contraction in more than five years, according to the detailed figures released by INSEE today. Household spending fell an annual 0.1 percent, while exports declined 1.7 percent, from an increase of 2.6 percent in the first three months.
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