Spending on manufactured goods rose 0.4 percent on the month at year-end, double the market consensus and matching its unrevised gain in November. This made for the first back-to-back increase since June/July and left purchases at a 5-month high. Annual growth improved from minus 1.8 percent to minus 0.1 percent but volumes were still fully 4.2 percent below their pre-pandemic level in February 2020.

December's monthly gain reflected a 1.4 percent jump in durables, dominated by a 4.4 percent surge in transport equipment. By contrast, textiles and clothing dropped 0.7 percent and household durables slumped 3.0 percent. Elsewhere, food was down 0.7 percent but energy advanced 1.7 percent. As a result, overall goods spending was up 0.3 percent after a 0.6 percent increase in November.

Despite December's increase, goods consumption in the fourth quarter declined 0.6 percent versus the third quarter when it rose 0.6 percent. Looking ahead, consumer confidence strengthened in January but remained well below its long-run average. With spending intentions following a similar pattern, the chances are that the first quarter data will remain sluggish. Still, with the French RPI at 7 and the RPI-P at 8, overall economic activity is actually performing just slightly better than the forecasters predicted.

Spending is seen rising 0.2 percent on the month after a 0.4 percent increase in November.

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.