French consumer spending on manufactured goods rose by a stronger-than-expected 1.1 per cent in March, helped by a rise in car and clothing sales, national statistics office INSEE said today.
The monthly rise was well above a consensus forecast for a 0.3 per cent rise and INSEE also revised the previous month's figure to show a 1.8 per cent fall instead of the 2.0 percent fall earlier reported.
There were strong monthly rises in car sales, which were up 2.9 per cent, continuing the improvement seen in previous months as government subsidies for trading in old cars for new vehicles have encouraged buyers.
Textile and leather sales also rose 3.5 per cent, INSEE said but household equipment sales, which have suffered as housing prices have fallen, were down 0.5 per cent, the report showed.
Overall, consumer spending was up 0.4 per cent in the first quarter, an improvement over the 0.6 per cent decline recorded in the previous three months, INSEE said.
The figures added to other positive signs in the retail sector, coming two days after one of France's biggest retailers, Casino, said it was seeing improving trends overall, helped by special promotions and good results in the Easter period.
Data from purchasing managers surveys yesterday also added to signs that the severity of the recession that has swept euro zone economies may be easing.
Speaking in Washington, shortly before the figures were announced, Economy Minister Christine Lagarde said there were "interesting little signals" in the French economy, with signs of improvement in the car and real estate sectors.
In a statement, she said the figures encouraged hopes of a pick up over the medium term and showed the effects of the government's stimulus measures. However she added that there would be a significant contraction in 2009 and it would take several quarters for the economy to recover.
Reuters