INSEE: Higher French Q1 Income
INSEE official statistical data showed that French households’ savings in the first quarter rose as income also rose thanks to government measures to bolster buying power.
This indicated that the economy maintained a steady growth rate during the period.
Data from INSEE showed that France’s economy, which is the second-biggest in the Eurozone, expanded 0.3% in the three months ending in March. This was down from the revised 0.4% growth posted in the fourth quarter.
After French President Emmanuel Macron’s government’s introduction of measures in December amounting to more than 10 billion euros ($11.2 billion), French households’ disposable income jumped 0.9%.
The measures’ goal was to increase the poorest workers and pensioners’ incomes.
Consumer spending gained only 0.4% in the first quarter amid the efforts to boost incomes, which were up 0.3% during the previous quarter.
GDP reports, meanwhile, suggest that households are setting aside extra cash. Savings increased to 15.3% from 14.9% at the end of the previous year.
The government implemented the said measures in concessions to protestors who started a series of violent street demonstrations.
Macron has followed up last month with a promise to cut income tax by a further 5 billion euros.
CAC, other Indices Fall on Chinese Remarks
In spite of the INSEE data, French’s CAC stock index still lost 1% after Chinese newspapers warned that China was prepared to use its supply of rare metals amid a worsening trade war with the United States.
Investors have then flocked safe haven assets.
In Germany, DAX, which is usually sensitive to trade-related news, lost 1.2%.
The pan-European STOXX 600 index shed 0.9%. The worries over economic growth have dragged the pan-regional index down to its first likely monthly fall in the year.
China’s Huawei Technologies Co Ltd., which has been banned by the US, has filed a lawsuit against the US government, hoping to fight the curbs.
Europe’s auto and mining stock indexes lost 1% and 1.7% respectively. Technology shares were dragged down by semiconductor shares.
The bank index also declined 1.3%, with Italy locking horns with the European Union, thus dampening sentiment.
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