France: GDP growth stable in Q4; economy records significant acceleration overall in 2015
February 29, 2016
According to second estimates released by the statistical office (INSEE), the French economy grew a modest 0.3% in the fourth quarter of 2015 over the previous quarter in seasonally-adjusted terms, which matched the 0.3% growth seen in Q3. The reading slightly overshot market expectations of a softer 0.2% increase. Year-on-year, GDP accelerated from a 1.1% rise in Q3 to a 1.4% expansion in Q4, which marked the fastest growth in four years. Overall, GDP rose 1.1% in 2015, which was a significant acceleration compared to the mild 0.2% expansion tallied in 2014.
The fourth quarter’s moderation was mainly the result of softer domestic demand, which more than offset a less negative contribution of the external sector. Private consumption in Q4 contracted 0.2% over the previous quarter, which contrasted the 0.5% growth recorded in Q3. Growth in government spending inched up from 0.4% in Q3 to 0.5% in Q4. Meanwhile, gross fixed investment grew 0.7% in Q4 (Q3: +0.1% quarter-on-quarter).
The external sector recorded a less negative contribution as exports of goods and services rebounded and grew 1.0% in Q4 over the previous quarter (Q3: -0.6% qoq). Imports expanded 2.5% in Q4 (Q3: +1.7% qoq). As a result, the external sector’s net contribution to overall economic growth improved from minus 0.7 percentage points in Q3 to minus 0.5 percentage points in Q4.
Author: Eric Denis , Economist