French Retail Sales Continue Weak

French retail sales continue to be weak. In May retail sales volumes fell by 0.2% month-to-month with a rise of 5.1% in food sales blunting a drop of 2.8% in nonfood sales. Nonfood sales have fallen for four months in a row.

The overall retail sales volume change over the past 12-months ranks in the lower 17th percentile of all Yr/Yr sales changes back to 1994 (see 'rank % Y/Y' in the table). Food sales are relatively stronger, standing in the 37th percentile of their historic queue with nonfood sales in the 15.8 percentile of their queue. Of the categories in the table, textiles, footwear and furniture are the relative weakest according to their queue standings.

The pace of the overall sales volume decline has let up a bit over three-months but the six-month pace of decline is in excess of the 12-month pace of decline. The retail sector in France is still under a lot of downward pressure.

But when looked at slightly differently the downward pressure in retailing, like in manufacturing, is still in gear but is losing some of its downward momentum.

For example the Yr/Yr growth rate in overall sales volumes was more intensely negative in each of the previous nine months. Food sales were weaker year-over-year in each of the previous six-months. But, for nonfood items, sales are continuing to hit even weaker year-over-year growth rates. Auto sales are showing some recovery as they were last weaker (year-over-year) in each of the previous nine months.

Autos sales are leading the way to better sales results compared to their past trends. Even though auto sales are still falling faster than other sales, auto sales are faring better relative to their past trends that are sales of other nonfood items. For autos there is a clear diminished negative tendency whereas for other sales the degree of the sales decline is a near constant drone.

Still these 'positive' trends are among some of the weakest positive statements we can make about improving trends. Only the electronics sector has three months in a row of Year-over-year sales gains and it is the only sector among those in the table that is up in May year-over-year. For the most part, the good news is in the change in the rates of change.

On balance France is still struggling and while there is some sense of improvement it is one that takes dome digging to find. France is still a troubled euro-Zone economy and it still has a lot of its adjusting yet to do. The Hollande Administration used its tax hikes to keep government spending programs more or less in place and has not implemented some of the austerity that France still needs to confront.