France’s consumer purchasing power growth slows in Q2 ’24

France’s household purchasing power per consumption unit slowed to a 0.2 per cent in the second quarter of 2024, down from 0.4 per cent in the previous quarter.

This deceleration was driven by a sharp slowdown in household gross disposable income (GDI), which rose by 0.6 per cent, compared to a 1.6 per cent rise in Q1.

The reduction in social benefits growth to 0.8 per cent, following a significant pension revaluation in the previous quarter, contributed to the slowdown. However, the wage bill saw an uptick, increasing by 0.7 per cent as wages rose and salaried employment remained stable.

Household consumption prices rose modestly by 0.2 per cent, following a 1.0 per cent increase in Q1, further slowing the growth in purchasing power. As a result, the household savings rate increased to 17.9 per cent, up from 17.6 per cent in the previous quarter, reflecting a cautious approach to spending amid slower income growth.