French confidence ticks up but job fears hit highest since 2021

French household confidence edged up to 84 in June from 83 in May, just above the 83 consensus estimate. The reading remains well below the long-term average of 100.

Insee, the French statistics office, restructured the survey this month. It introduced a new savings climate synthetic index that measures household saving behaviour and expectations, combining current and expected saving capacity with the opportunity to save. Those components are now stripped from the headline confidence gauge and reported separately.

The headline improvement masks a worrying shift in labour-market sentiment. Unemployment expectations rose to 60, the highest since March 2021. That reading has climbed steadily through the spring.

Price expectations offered a counterweight. The balance of households expecting higher prices over the next 12 months fell to -15 from +11 in May. That is a sharp drop but still above the -31 reading in February, before the Middle East conflict pushed energy costs higher.

The savings climate index, Insee's new measure, will give a cleaner read on whether households are hoarding cash or spending. That matters for the consumption outlook, which has been a drag on French GDP. The next release in July will show whether the June improvement in confidence holds or fades.

For traders watching the euro, the French data adds to a mixed picture across the euro area. German consumer sentiment missed expectations earlier this week, while Spanish confidence has held up better. The EUR/USD profile shows the pair trading near the middle of its recent range, with the next catalyst being euro-area inflation data due Friday.

Insee said the new savings index will be published alongside the monthly confidence report going forward. The June reading of the savings climate index was not disclosed in the initial release.