FR: Consumer Mfgd Goods Consumption

Fri Dec 22 01:45:00 CST 2017

Consensus Actual Previous Revised
Month over Month 1.5% 1.4% -1.6% -1.7%
Year over Year 1.6% 0.2% 0.1%

Having unexpectedly slumped a steeper revised 1.7 percent on the month in October, household spending on manufactured goods rebounded in November. A 1.4 percent jump, which broadly matched the market consensus, failed to make back all the previous period's loss but that followed a strong September (1.0 percent) and annual growth rebounded from 0.1 percent to a much more respectable 1.6 percent.

Durable goods saw a 1.8 percent monthly spurt, mainly reflecting a 4.7 percent surge in household goods. Textiles (3.1 percent) also had a very good month and there were gains too in both autos (0.3 percent) and the other manufactured goods category (1.2 percent).

Meantime, total goods spending was up a monthly 2.2 percent, fully reversing October's 2.1 percent drop and a multi-year record. Compare with November 2016, purchases were up 1.2 percent. Nonetheless, despite November's recovery average sales in October/November were still 0.5 percent short of their mean level in the third quarter and December will need at least a 0.4 percent monthly increase just to hold the fourth quarter flat.

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.