Household consumption remains solid
In 2007, household consumer expenditure increased by 2.5% in real terms, after a 2.3% rise in 2006. End-of-year price rises only had a limited impact on average inflation in 2007. In fact, averaged out over the year, there was a slight slowdown in prices, with the rise reaching 2.0% (2.2% in 2006). The significant rise in the purchasing power of income, which was stronger than in 2006, meant that households could consume more while saving an increased proportion of their budget. For ten years, purchases of IT products have underpinned consumption, and 2007 did not buck this trend. Consumption was also boosted by a recovery in car purchases, which fell significantly in 2006.