Fuel tax rise which sparked weeks of violent protests in France have now been dropped from next year’s budget.
The move was announced by Prime Minister Edouard Philippe, who a day earlier had only promised to postpone them for six months.
The “gilets jaunes” (yellow vest) protests who hit major cities over the past three weekends, plan further demonstrations for this weekend.
Four people have died since the unrest began and the resulting violence and vandalism have been widely condemned.
It is a major climb down by the government of President Macron, who had said the measures were necessary to combat climate change and meet budget deficit reduction targets.
Mr Macron was elected on a platform of economic reform which would improve the lives of French people via lower unemployment and a kick-started economy.