In May, household consumption remained 7.2% below its pre-containment level.
The household consumption in France rebounded significantly in May compared to April but remains below its February level (-7.2%), before the health crisis, announced INSEE on Tuesday. France began its progressive deconfinement on May 11, while in April the French were confined for the entire month, which prevented them de facto from consuming. Consumption thus fell by 32% in April compared to February, according to the National Institute of Statistics, which revised its estimate upwards slightly.
Compared with May 2019, household consumption also fell 8.3% last month. Consumption of manufactured goods rose without however returning to its pre-crisis level (-14% in May, after -62.4% in April compared with February). It remains “relatively low” mainly due to the “very low” level of purchases of durable goods (transport materials, housing equipment) and expenditure on clothing and textiles. On the other hand, consumption of other manufactured goods “almost returns” to its February level.
Same pattern for energy spending: it remained behind that of February (-14.3%): due to the drop in oil prices and less travel, French spending continued to decline. On the other hand, food consumption remains at a “high” level compared to February (+ 4.1%, after +3.4 in April).
0.1% year-on-year inflation in June
Consumption of fresh fruits and vegetables increased slightly, as did that of processed foods from the food industry, after a sharp decline in April and a sharp increase in March, when the French stocked products in anticipation of containment. Economists and the government are scrutinizing the level of consumption in France because it is the main engine of economic growth and a key element for the recovery.
For its part, the rise in consumer prices slowed to 0.1% over a year in June in France, against 0.4% the previous month, said INSEE in a provisional estimate on Tuesday. This fall in inflation is the result of “a slowdown in the prices of services and food and a steep decline in those of manufactured products,” the institute said in a statement.