French Economy Stalls in Q2

France economy recorded no growth in the second quarter of 2016, following a 0.7 percent expansion reported in January to March period and matching preliminary figure, second estimate showed. It was the lowest reading since the second quarter of 2015, as a contraction in fixed investment weighed on growth. In contrast, government spending expanded and net external demand contributed positively while household consumption stalled.

In the June quarter, total gross fixed capital formation declined by 0.2 percent, after growing 1.3 percent in the March quarter while household consumption decelerated sharply (+0.0 percent from +1.2 percent in the previous three months). In contrast, government expenditure expanded 0.4 percent, the same pace as in the preceding quarter. Final domestic demand (excluding changes in inventories) was virtually stable, contributing 0.1 points to GDP growth (after +1.0 points in Q1). Changes in inventories contributed negatively: -0.7 points after -0.1 points in the March quarter.

Exports dropped by 0.1 percent, slower than a 0.4 percent decline in the previous quarter. Imports dropped by 2.0 percent, compared to a 0.5 percent growth in the first quarter. The foreign trade balance contributed positively to the economy (+0.6 points after -0.2 points in the preceding quarter).

Year-on-year, the GDP grew 1.4 percent, after growing by an upwardly revised 1.4 in the previous quarter and in line with preliminary estimates.

French Economy Stalls in Q2

Insee l Rida Husna |
8/26/2016 10:03:19 AM