French shoppers plan to cut their Christmas-season spending, joining Italians and Greeks in reducing purchases as unemployment in the euro region lingers at record highs, a study by Deloitte LLP shows.
The French will spend 0.9 percent less on average than last year celebrating the late-December holiday, while Italian buyers will scale back their budget for the season by 2.4 percent and Greeks by almost 13 percent, according to a poll taken in mid-September of more than 17,000 consumers in 18 countries. Germans, Russians and Spaniards are among consumers who will spend more this year.
The economy of the 17 nations using the euro emerged from a six-quarter recession, the longest since the currency was created in 1999, in the three months through June. Gross domestic product in France has increased following a six-month contraction that ended in March. The European Commission forecast on Nov. 5 that the French economy will expand for the full year, while GDP in Greece and Italy will shrink.
The Deloitte poll was conducted in 14 European Union countries, including 11 in the euro area, as well as Switzerland, Ukraine, Russia and South Africa.
On average, Europeans will purchase 450 euros ($610) worth of gifts, food and drinks and socializing at the end of the year, 0.7 percent more than in the 2012 period, with money and books the most desired presents, Deloitte said. The regionwide growth will be the first since 2008.
Shoppers in France will spend an average 531 euros during the season, and Greeks will lay out 451 euros, Deloitte said. Irish consumers still have the largest budget, at 894 euros, following a 1.7 percent cut, according to the study. Germans will raise their Christmas budget 6.7 percent to an average 399 euros, while Spanish buyers will increase theirs by 1 percent to 567 euros.
The European Commission, the EU’s executive arm, cut its forecast for euro-area economic growth next year on Nov. 5 as the sovereign-debt crisis drags into a fifth year. Unemployment (UMRTEMU) in the region was at 12.2 percent in August and September, the highest since the euro was introduced.
More than four French consumers out of 10 estimate their purchasing power will diminish next year, according to Deloitte’s study. Sixty-four percent are cutting back Christmas buying because they expect the economy to worsen, compared with only 57 percent with that view last year.
While French consumers plan to cut their gifts budget by 2.7 percent, they will spend 2 percent more for the Christmas meal, Deloitte said. Eighty-two percent of French shoppers will seek discounts when doing their Christmas shopping, it said. Online purchases are planned by 38 percent of shoppers in France, compared to 47 percent of Germans and 21 percent of Greeks.
Entertainment, electronics and holidays are among the expenses that Europeans are the most ready to reduce, the Deloitte survey shows. A majority of Europeans aren’t ready to cut health, housing and education expenses, the figures show.
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