French Economy Stagnant in Q3

14 November 2006

PARIS: The French economy languished at zero growth rate in the third quarter of 2006, according to national statistics body INSEE (Institut National de la Statistique et des Études Économiques).

However, INSEE has given no details and economists are waiting until today's (Tuesday's) estimate for the whole of the euro-currency area to learn if the US slowdown has spread to Europe.

Consumer spending in France continues to rise, nevertheless. Economists say the average quarterly growth rate over the last half year, at 0.6%, represents the economy's underlying trend.

But French manufacturing is experiencing a less buoyant time, with industrial production dropping 0.5% during Q3.

After the poor quarter, European banking group BNP Paribas expects France's economy to grow around 2% this year, down from its earlier 2.3% forecast.

Data sourced from Wall Street Journal Online; additional content by WARC staff