French consumer confidence tumbles to 2013 low as fiscal woes mount

• France's consumer confidence index for October came in at 80, below the 85 consensus estimate.
• The prior month's reading was 86, later revised down to 85.

The data represents a significant setback. In October, French household sentiment dropped to its weakest point since 2013, dragged down by fiscal concerns and unease about the nation's public finances. The index has moved further from the long-run average of 100, a level not seen since December 2021, which is a troubling sign.

Most sub-indices recorded sharp declines, with households reporting deteriorating financial situations both past and anticipated. Additionally, the sub-index tracking past and expected living standards fell significantly in October.

Further worrying consumers is the belief that inflationary pressures will intensify in the coming months. The sub-index for future price expectations climbed to -7 points, the highest since May, and far above the -32 points seen in July.

Unemployment concerns also intensified, as the relevant sub-index increased by 5 points month-on-month to 61. That reading is the highest since March 2021.

This is a comprehensively weak report, indicating that the French consumer environment has worsened significantly due to social unrest and fiscal challenges. The deterioration is already visible in economic data, with this month's French PMI readings proving disappointing.

This situation will remain a difficult issue for the European Central Bank to handle, as growth slows further in the eurozone's second-largest economy and price pressures are set to increase more widely.