Household spending on manufactured goods was surprisingly soft in mid-quarter. A 1.1 percent monthly fall reversed much of January's marginally firmer revised 1.3 percent bounce and reduced annual growth from minus 2.9 percent to minus 4.0 percent. Purchases now stand 4.1 percent below their pre-pandemic level in February 2020.

February's decline reflected a 1.4 percent monthly fall in durables within which household durables were down 2.0 percent and transport equipment 1.6 percent. Other engineered goods (minus 0.5 percent) also subtracted while textiles and clothing were just flat. Elsewhere, food (minus 1.2 percent) similarly declined but energy (0.1 percent) was marginally firmer. Consequently, overall goods spending fell 0.8 percent, unwinding around half of January's advance.

The February data put average overall goods spending in the first two months of the quarter 0.4 percent above their mean level in the fourth quarter, potentially leaving consumption on course to make a positive contribution to real GDP growth. However, consumer confidence was very weak in March and barely above the all-time low posted in June 2013. Much the same applied to buying intentions which, outside of the arrival of Covid, remain at a record-equalling low. Accordingly, the near-term outlook for retailers would still seem fairly grim. Even so, today's updates put the French ECDI at 21 and the ECDI-P at 10, both measures signalling a degree of overall economic outperformance albeit largely due to strong prices.

Spending is seen sliding 0.2 percent on the month after a surprisingly strong 1.2 percent spurt in January.

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.