In October, household consumption of goods in volume declined by 0.1 percent, some 0.2 percentage points below the consensus. This contraction reflects decreases in engineered goods (minus 1.3 percent) and energy (minus 1.2 percent), offset by a notable rebound in food consumption (1.2 percent).

Engineered goods experienced a sharp decline, driven by a significant 5.1 percent drop in textile-clothing spending. This downturn is attributed to reduced purchases of clothing, shoes, and leather goods, though overall spending remains 2.0 percent above October 2023 levels. Durable goods fell slightly due to lower spending on housing equipment, including computers and telephones, and a decline in used car purchases. Other engineered goods remained stable, reflecting a stagnation in demand within this category.

Energy consumption decreased further, continuing September's downward trend, primarily due to reduced electricity and gas expenditures, indicating potential shifts in household energy usage patterns. However, food consumption rebounded strongly, led by increased spending on processed food products.

These trends suggest households are prioritising essentials like food while cutting back on discretionary spending, particularly on textiles and durable goods, amid evolving economic pressures. This update takes the French RPI to minus 25 and RPI-P to minus 15, meaning that economic activity in general is lagging well behind market expectations.

Spending is expected to edge up just 0.1 percent on the month having only stagnated in September.

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.