PARIS (Bloomberg) -- Consumer confidence in France dropped to a record low in May as fuel and gasoline costs soared, prompting fishermen to stage protests about shrinking incomes.

A gauge of consumer sentiment fell to minus 41, the lowest since the index was introduced in 1987, from a revised minus 38 in April, Insee, the Paris-based national statistics office, said Wednesday. Economists surveyed by Bloomberg predicted the reading would stay at minus 37, according to the median of 23 forecasts.
“Inflation remained the main concern of households, which have felt the extra jump in prices over the past weeks,” said Mathieu Kaiser, an economist at BNP Paribas SA in Paris. “Poor results on consumer spending since the start of the year mark a real change in trend, and the slowdown should continue.”
President Nicolas Sarkozy earlier this week outlined tax breaks for companies that introduce or raise annual bonuses, and defended his plan to deregulate the retail industry amid the fastest inflation in at least 12 years. Tuesday, he pledged to raise a rebate on heating fuel for impoverished households by 50 euros ($79) to 200 euros next year.
France’s inflation rate held at 3.4 percent in April after reaching 3.5 percent in March, the highest in at least 12 years. As a result, consumer spending on manufactured goods fell 0.8 percent in April from March, the third drop in four months, Insee reported last week.
------------Rising prices
French shoppers are spending less and buying more generic- brand goods since the start of the year in an attempt to counter rising prices, Le Monde reported on May 26, citing Arnaud Mulliez, chairman of supermarket group Auchan France.
The government is seeking European Union approval for a 310 million-euro, three-year plan to support the fishing industry, whose workers have blockaded ports and clashed with police during protests against soaring oil costs.
The surge in oil prices has come as a “violent shock” to the airline industry, said Jean-Cyril Spinetta, chief executive officer of Air France-KLM Group, Europe’s largest airline, on May 22. Oil futures hit $135.09 on May 22, the highest since trading began in 1983, and have doubled in the past year.
The Euronext Paris CAC Consumer Goods Index, which includes carmaker Renault SA, has dropped 17.2 percent since the start of the year, and the Euronext Paris CAC Consumer Services Index has shed 16.7 percent, lagging the broader SBF250 Index they belong to, which has fallen 12.1 percent.
Economic growth “will probably be less buoyant in coming quarters as French consumers are striking a bit, or at least spending less actively,” Bruno Cavalier, an economist with Oddo and Cie. in Paris, said in an interview with Bloomberg Television before the report.
The gloom stemming from a U.S.-led economic slowdown is also catching French manufacturers. A business confidence index fell in May to the lowest since December 2005, according to Insee.
A year into office, Sarkozy’s economic policies, which include tax breaks on overtime work and reductions in the number of civil servants, are disapproved by 67 percent of the French, a BVA/Les Echos poll held May 23 and 24 showed.