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Household consumption remains on the downside

March 27 category:Economy
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Household consumption remains on the downside

The French household consumption fell 0.4% in January 2012 after -0.2% in December

REUTERS / Alex Domanski

Consumer spending French household goods fell 0.4% in volume in January, after falling 0.2% (revised from +0.5 point) in December, said Wednesday the National Institute Statistics and Economic Studies (INSEE) in a statement. This further decline in consumer spending, the main engine of growth in France, is attributable to the decline in spending on manufactured goods and in particular to the sharp decline in car purchases, said INSEE.

In detail, the expenditure on durable goods declined significantly in January (-4.3% after + 3.0% in December), dragged down by auto purchases (-7.6% in January after 2.8% in December). Households could have anticipated purchases of cars against the hardening of the bonus-malus on 1 January 2012, analyzes INSEE. Purchases of equipment housing retreating to a lesser extent (-1.5%) after strong growth in December (+ 4.3%). Purchases of textile and leather decline in January (-2.3%), after a December already sluggish (-1.7%). Consumer spending in the "other manufactured goods", however, are stable in January.

The decline in hardware-yourself spending is offset by the growth of health goods consumption. Food consumption increases by 1.4% after three consecutive months of decline (of which 1.0% in December). As for energy costs, they are rising after four consecutive months of decline. These expenses increased by 2.0% in January (after -2.4% in December), supported in particular by oil purchases.

The revision of the figure from December to -0.2% against -0.7% announced a month earlier was due to the integration of new data on the computer and electronic products, as well as updating the coefficients seasonal adjustment (including auto purchases) further specifies INSEE.

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