The French government will suspend a fuel tax rise which has led to weeks of violent protests, local media report.
The protests have hit major French cities causing considerable damage for the past three weekends.
Prime Minister Edouard Philippe sought compromise with the protesters, but they called off talks citing death threats from extremists in their ranks.
The “gilets jaunes” (yellow vests) protests have now grown to reflect more widespread anger at the government.
Three people have died since the unrest began and the resulting violence and vandalism – notably when statues were smashed at the Arc de Triomphe last Saturday – have been widely condemned.
“Yellow vests” are so called because they have taken to the streets wearing the high-visibility yellow clothing that is required to be carried in every vehicle by French law.
The movement has grown via social media and has supporters across the political spectrum.