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French minister plays down consumer spending slide

PARIS, June 25 (Reuters) - French consumer affairs minister Renaud Dutreil said on Wednesday a tumble in household spending figures for May was largely due to the impact of a string of labour strikes and also to numerous public holidays.

"There was a drop in May but this can be largely put down to special factors -- firstly there were many public holidays and above all there were strikes that disrupted consumption," he told reporters.

Dutreil, a junior minister with responsibility for small- and medium-sized business, retail and consumption, spoke during a visit to the Galeries Lafayette retail store in Paris on the first day of summer discount sales.

His visit came hours after statistics office INSEE reported that consumer spending took its sharpest monthly dive in nearly four years in May, slumping 1.6 percent and led down by a 3.7 percent dip in car buying and strong falls in clothing and durable goods.

He said annual rises in the compulsory minumum wage -- known as the SMIC in France -- would give a boost to purchasing power as of July when the rises take effect.

"So I think growth is on the way. The question is when will recovery proper kick in -- will it be in the coming weeks or is it for the start of 2004," he said, adding that there was often a lag between U.S. and Europe in periods on recovery.

"I believe the Americans are doing what they can to ensure a recovery in the U.S. economy. The issue in Europe and in France in particular is that there's quite a lag time between recovery in the U.S. and here (in France).