French Economy Exits Recession With 0.5% Rise in Q2
In Q2 of 2013, French GDP in volume terms rose by 0.5 percent after a 0.2 percent fall in each of the two previous quarters. It is the largest increase since Q1 of 2011 and is driven by consumer spending and industrial output however offset by yet another fall in investment.
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Household consumption expenditure accelerated (+0.4 percent after -0.1 percent). Total gross fixed capital formation decreased again, but less sharply than in the beginning of the year (-0.5 percent after -1.0 percent). All in all, final domestic demand (excluding changes in inventories) contributed to GDP acceleration: +0.3 percentage points in Q2.
Total production of goods and services strongly accelerated: +0.9 percent after 0.0 percent. Production of manufactured goods accelerated (+2.0 percent after +0.2 percent), driven by a rebound in transport equipment production (+8.2 percent after -1.0 percent), specifically in the automotive and aircraft industries. Production of tradable services accelerated as well (+0.7 percent after 0.0 percent), notably in the business services.
Both exports (+2.0 percent after -0.5 percent) and imports (+1.9 percent after +0.1 percent) rebounded. Consequently, the external trade balance made a neutral accounting contribution to GDP growth this quarter (after a contribution of -0.2 points).