Bloomberg News

French Household Confidence Increases for Second Month

February 26, 2012

(Updates with comment from economist in fourth paragraph.)

Feb. 24 (Bloomberg) -- French consumer confidence climbed for a second month in February after the economy unexpectedly expanded in the fourth quarter, adding to signs of recovery.

A measure of sentiment rose to 82 in February from 81 in January, national statistics office Insee said in Paris today. That matched economists’ expectations for a reading of 82, according to 15 forecasts gathered by Bloomberg News.

The increase came two months after confidence reached its lowest in almost three years. While the survey’s readings for consumers’ personal finances and ability to save improved, the overall measure remained below its long-term average of 100 amid concern about joblessness and pledges of budget cuts from all the main candidates in this year’s French presidential election.

“Higher unemployment, a focus on saving money ahead of the coming elections” as well concern about tax increases “could lead to a further deterioration of consumer confidence,” said Pierre-Olivier Beffy, an economist at Exane BNP Paribas in London.

The survey’s reading for consumers’ ability to save in future improved to 24 from 21 and the gauge of their personal financial prospects improving to minus 26 from minus 28, Insee said.

“More households judge now than in January that it’s a good time to save,” Insee said. Almost as many people as in January “are predicting an increase in unemployment,” the statistics office said. The reading for the joblessness outlook gained to 64 from 65.

The number of people actively looking for work in France rose by 29,700, or 1.0 percent, in December to 2,874,500, the Labor Ministry said Jan. 25. That’s the highest total since September 1999. In all of last year, the number of jobless climbed 5.6 percent. The ministry reports jobless claims for January later today.

--With assistance from Barbara Sladkowska in Warsaw. Editors: Eddie Buckle, Jeffrey Donovan

To contact the reporter on this story: Mark Deen in Paris at markdeen@bloomberg.net

To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net


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