French households increased their spending by 1.5 per cent in January, official figures showed today.
That figure far surpassed market expectations to signal a positive start to 2005 for the euro zone's second biggest economy.
The rise in consumer spending, traditionally the main driver of growth in France, outpaced the mid-range forecast in a Reuters poll of economists for no month-on-month change.
It was the biggest rise since November last year, when spending also rose 1.5 per cent month-on-month.
National statistics office INSEE revised December's spending figure to show a month-on-month fall of 0.4 per cent compared to a previously reported rise of 0.2 per cent. January consumer spending rose 3.8 per cent year-on-year, INSEE said.
The January spending rise followed a strong final quarter to 2004, when consumer spending posted its biggest quarterly gain in almost four years to drive economic growth of 0.8 per cent, ensuring France outpaced euro zone peers Germany and Italy.
France's conservative government has made efforts to boost consumer confidence and spending, pledging tax cuts and a reform of a key retail law with the aim of stimulating competition between retailers and prompting them to cut their prices.