French consumer spending was stronger than expected in July and August, official figures have shown.
Solid growth in spending on cars and housing equipment pushed spending up 0.9 per cent in July and 1 per cent in August, compared with expectations of 0.2 per cent and 0.3 per cent, respectively.
The INSEE figures, following June’s 1.6 per cent growth, suggest France has seen its best summer for consumer spending in more than a decade, according to analysts.
With a weak export sector, domestic spending is key to the French economy.
Manufacturers are worried as exports have been hit by the strength of the euro.
The INSEE data showed that spending on cars rose 1.9 per cent in July and 3.4 per cent in August, while spending on household equipment rose 0.9 per cent in July and 2.8 per cent in August.
The bank forecast growth of 0.6 per cent between July and September, and annual growth of 2-2.5 per cent for the year.
This came after the European Commission downgraded its annual growth forecast for France to 1.9 per cent from 2.4 per cent, based on third- and fourth-quarter growth of 0.5 per cent.