French output in the third quarter grew less than expected as part of a start-stop expansion that leaves Europe’s second-largest economy lagging its neighbors.
GDP expanded 0.2 percent in the three months through last month after shrinking 0.1 percent in the previous period, national statistics office Insee said yesterday.
That compared with a 0.3 percent increase predicted by economists in a Bloomberg survey.
The sluggish performance is adding pressure on French President Francois Hollande, who has promised to say by the middle of December whether he will seek a second mandate in an election that is less than six months away.
French Minister of Finance Michel Sapin said that the third-quarter figures would make it difficult for the French government to achieve its full-year growth target of 1.5 percent, though he rejected suggestions that the Socialist Party seek an alternative presidential candidate.
“The growth is there,” Sapin said on RTL radio. “Francois Hollande is the person best placed to unite the left.”
With full-year growth set to come in at about 1.3 percent, according to a separate survey, France will be matching last year’s performance, which was the best in four years. However, that is less than half the pace of the expansion expected in Spain and below the 1.8 percent expected for both Germany and the UK.
“The big picture is that there is some modest reconvergence between the laggards like France and Italy and the stellar performers such as Spain,” said Frederik Ducrozet, an economist at Banque Pictet & Cie in Geneva, Switzerland. “That’s the trend beyond the noise and the volatility: Both are re-converging towards their potential growth, which is fairly low for France in particular.”
For a second straight quarter French consumer spending was unchanged and corporate investment declined. Inventory building contributed 0.6 percent to growth in the period, while trade generated a 0.5 percent drag on the expansion, Insee said.
European Central Bank economist Peter Praet on Wednesday said that although the eurozone recovery “is showing signs of resilience, material downside risks remain.”
The Governing Council has a crucial meeting in December, when it will have new forecasts and an internal report on its bond-buying program.
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