|Month over Month||0.5%||-0.4%||-0.3%||-0.1%|
|Year over Year||0.4%||0.6%|
Household spending on manufactured goods was again disappointingly soft in April. A 0.4 percent monthly decline followed a smaller revised 0.1 percent dip in March and means that purchases have now fallen in four of the last five months. Annual growth eased from 0.6 percent to 0.4 percent, a 3-month low.
April's weakness was concentrated in engineered goods which were off 0.8 percent on the month. Autos (minus 0.4 percent), textiles (minus 2.1 percent) and the other engineered goods category (minus 0.1 percent) all struggled. However, food products rose 0.9 percent and energy rebounded 3.1 percent.
As a result, total goods spending increased 0.5 percent, offsetting half of the 1.0 percent drop posted in the previous two months, to stand 0.1 percent above its first quarter mean. Importantly, consumer confidence seems to be on the up and, after months of stability, rose a couple of points to 102 in May, its highest reading since August 2007. The second quarter could yet surprise on the upside.
Consumption of manufactured goods by consumers is an indicator of consumer spending for household durable goods such as autos and furniture. The data are released separately as part of the report on total goods spending.
This indicator is a measure of retail sales and is unique to France. It measures consumer spending for household durable goods such as autos and furniture. The data are seasonally and workday adjusted. These adjustments eliminate the fluctuations that are solely due to changes in the number of working days. The data appear to be particularly sensitive to the number of worked Saturdays. With consumer spending a large part of the economy, market players continually monitor spending patterns. Retail sales are a measure of consumer well-being.
The pattern in consumer spending is often the foremost influence on stock and bond markets. For stocks, strong economic growth translates to healthy corporate profits and higher stock prices. For bonds, the focus is whether economic growth goes overboard and leads to inflation. Ideally, the economy walks that fine line between strong growth and excessive (inflationary) growth.
Retail sales not only give you a sense of the big picture, but also the trends among different types of retailers. Perhaps auto sales are especially strong or apparel sales are showing exceptional weakness. These trends from the retail sales data can help you spot specific investment opportunities, without having to wait for a company's quarterly or annual report.