PARIS, Dec 23 - French consumer spending fell 2.8 percent in November as households worried by unemployment cut back spending on retail goods even in the run-up to Christmas, figures from national statistics office INSEE showed on Tuesday. The fall was bigger than market expectations, with economists polled by having given a mid-range forecast for a fall of 0.75 percent month-on-month. November consumer spending rose 1.4 percent year-on-year, INSEE said. The November fall -- which followed month-on-month rises in September and October -- was marked by a 2.7 percent fall in spending on retail goods. Purchases of cars fell 5.7 percent, and spending on textiles and leather goods was down 9.2 percent. Monthly data on household spending, traditionally the main driver of growth in France, has seen ups and downs over the last year. INSEE revised its October figure to show a 0.9 percent rise in spending. It had previously reported a 1.6 percent rise.
The fall in spending backed up figures released by INSEE earlier this month showing French consumer confidence fell to an eight-month low in November as job worries cast a shadow over household morale. The weak spending figures set back hopes for a swift recovery in France, the euro zone's second largest economy after Germany. The government has forecast growth of 1.7 percent next year, which it needs to help rein in a bulging public deficit. Companies are showing guarded confidence about a recovery. "We have to be cautious," the co-chairman of French catering firm Elior , Robert Zolande, said last Wednesday. "The elements that we don't control are macroeconomic...We are not seeing any recovery at all at the moment." Separately, INSEE said French producer prices rose 0.1 percent month-on-month in November and increased 0.7 percent year-on-year. On Monday, the Bank of France said France's inflation record was poorer than that of the euro zone and that tobacco tax hikes -- some of them implemented and more to come in January -- were likely to make things worse.//