France GDP


France: Economy rebounds stronger than expected in Q3

November 14, 2014

In the third quarter, GDP expanded a seasonally-adjusted 0.3% over the previous quarter, according to a flash estimate released by the Statistical Institute (INSEE) on 14 November. The reading, which overshot the 0.1% rise the markets had expected, marked a notable improvement over the revised 0.1% contraction observed in Q2 (previously reported: 0.0% quarter-on-quarter). Over the same period last year, GDP growth accelerated from a flat reading in Q2 to 0.4% in Q3.

Q3’s result stemmed from an improvement in domestic demand, which was partially compensated by a deterioration in the external sector. Although growth in private consumption decelerated slightly in the third quarter (Q3: +0.2% qoq; Q2: +0.3 qoq), government spending increased notably over the previous quarter (Q3: +0.8% qoq; Q2: +0.5 qoq). Fixed investment continued to contract in Q3, albeit a slower pace.

The external sector’s net contribution to overall growth fell from minus 0.1 percentage points in Q2 to minus 0.2 percentage points in Q3, as growth in imports of goods and services outpaced that of exports. Imports rose from a 0.3% increase in Q2 to 1.1% expansion in Q3. Exports increased 0.5% over the previous quarter, which contrasted the 0.1% contraction tallied in Q2.

FocusEconomics Consensus Forecast panelists expect the economy to grow 0.4% in 2014, which is unchanged from last month's forecast. For 2015, panelists forecast economic growth at 0.9%, which is also unchanged from last month’s forecast.


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France GDP Chart

France GDP Q3 2014

Note: Quarter-on-quarter changes of seasonally-adjusted GDP and year-on-year variation in %.
Source: National Institute of Statistics and Economic Studies (INSEE) and FocusEconomics Consensus Forecast.

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