(Adds analyst comment, background, details)
By James Mackenzie
PARIS, April 24 (Reuters) - French consumer spending on manufactured goods rose by a stronger-than-expected 1.1 percent in March, helped by a rise in car and clothing sales, national statistics office INSEE said on Friday.
The monthly rise was well above a consensus forecast for a 0.3 percent rise and INSEE also revised the previous month's figure to show a 1.8 percent fall instead of the 2.0 percent fall earlier reported.
There were strong monthly rises in car sales, which were up 2.9 percent, continuing the improvement seen in previous months as government subsidies for trading in old cars for new vehicles have encouraged buyers.
Textile and leather sales also rose 3.5 percent, INSEE said but household equipment sales, which have suffered as housing prices have fallen, were down 0.5 percent, the report showed.
Overall, consumer spending was up 0.4 percent in the first quarter, an improvement over the 0.6 percent decline recorded in the previous three months, INSEE said.
"March is a good month and it's a decent first quarter for household spending on manufactured goods," said Alexander Law, chief economist at Paris-based consultants Xerfi.
"However let's not forget that this represents only 25 percent of household consumption. Other sectors like foodstuffs and services are not doing so well, in fact there are indications that retail sales have been very weak."
POSITIVE SIGNALS
The figures added to other positive signs in the retail sector, coming two days after one of France's biggest retailers, Casino, said it was seeing improving trends overall, helped by special promotions and good results in the Easter period.
Data from purchasing managers surveys on Thursday also added to signs that the severity of the recession that has swept euro zone economies may be easing.
But economists cautioned that with jobless rolls growing steadily and wage growth held back by the increasing slack in the labour market, consumer spending would stay under pressure.
"In that sense, I don't think it changes the picture that much," said Joost Beaumont, an economist at Fortis in Amsterdam. "Consumption growth will be lacklustre but at least it's not falling as rapidly as you might have expected."
Speaking in Washington, shortly before the figures were announced, Economy Minister Christine Lagarde said there were "interesting little signals" in the French economy, with signs of improvement in the car and real estate sectors.
In a statement, she said the figures encouraged hopes of a pick up over the medium term and showed the effects of the government's stimulus measures. However she added that there would be a significant contraction in 2009 and it would take several quarters for the economy to recover. (For a full table of March consumer spending data, please double click on [ID:nPAB004764] (For more analyst comment, please double click on [ID:nLN093036]) (Editing by Mike Peacock)