French consumer moral improved for the first time in four months as households turned more upbeat about the outlook for their personal finances and grew more inclined to spend, statistics office INSEE said today.
The rise in the confidence indicator to minus 24 from December's unrevised minus 26 bodes well for consumer spending, one of the key driving forces for growth in the euro zone's second biggest economy.
It is good news for Prime Minister Dominique de Villepin's centre-right government before April/May presidential elections, particularly as it coincides with data showing the jobless rate fell to a five-and-a-half year low 8.6 percent in December.
"It is a recovery which we can welcome and which reminds us that there are no risks of a collapse in French consumer confidence," said Jean-Louis Mourier, economist at Aurel Leven. "Opinions referring to future living standards and spending opportunities are improving so this seems to support the idea that consumption is headed in the right direction."
Recent data showed French consumer spending posted its biggest annual rise in nearly seven years in December. The breakdown of the report showed the measure of households' views on the outlook for their personal finances rose to minus 3 from minus 5 in December while the component tracking their opinion on whether it was a good time to spend rose to minus 10 from minus 17.