Latest figures from INSEE show France’s consumer confidence index at 93 in February 2025, matching expectations but higher than the prior month’s reading of 92. This is the best rating recorded since October 2024, indicating a gradual improvement in consumer morale since the start of the year.

However, the index remains below the long-term average of 100, signalling ongoing uncertainties. Additionally, concerns about unemployment have risen, with the index reaching 55, the highest level since April 2021.

A reading of 93 suggests confidence is picking up, though it remains lower than the historical norm. Households are more optimistic than they were at the end of last year, but not enough to suggest a major shift in sentiment. With inflation pressures easing in recent months, spending appetite appears to be recovering slightly. That said, the figure remains well short of pre-pandemic levels, and caution persists.

The worry over jobs stands out. The unemployment concerns index climbing to 55 means a growing number of people fear job losses. It is the highest in nearly four years, pointing to lingering nervousness despite steady hiring trends over the last few months. Often, when job security becomes a larger worry, consumers hold back on discretionary spending. That could slow down any pick-up in domestic demand, even with the overall confidence figure showing modest gains.

Inflation expectations have also moderated, helping tilt sentiment upwards. Nonetheless, if households expect job risks to rise, any boost from lower inflation may be muted. The timing here matters—if labour market concerns increase while expectations for price stability improve, spending patterns may not change as much as anticipated.

Looking further ahead, these factors influence market sentiment beyond just consumer activity. Traders assessing near-term demand trends should watch upcoming employment data closely. If job-related worries persist, there may be knock-on effects on retail sales and broader growth expectations. Any divergence between household confidence and business sentiment surveys could hint at whether this soft improvement carries weight or remains fragile.

Upcoming economic releases will be key in shaping expectations, especially inflation and wage growth figures. If wage data shows strong increases, that could alleviate some concerns around job security. On the other hand, weak earnings growth may reinforce the caution already visible in the data. Labour market trends, particularly in key industries, will determine whether consumers feel secure enough to maintain spending patterns as the year progresses.