French economy shows strong growth

The French economy grew by a higher-than-expected 0

The French economy grew by a higher-than-expected 0.8 per cent in the second quarter to consolidate a strong expansion earlier this year and boost hopes for a broader upturn in the rest of the euro zone.

The preliminary "flash estimate" issued by statistics office INSEE today was higher than the 0.6 per cent consensus forecast of economists polled.

France's second-quarter figure, which INSEE said was between 0.8 per cent and 0.9 per cent, but slightly closer to 0.8, sends an optimistic signal about growth in the wider euro zone before Friday's growth estimates for the 12-nation bloc.

INSEE also confirmed an estimate of growth in the first quarter of 0.8 percent, the fastest rate since late 2000.

READ MORE

France's strong performance in the April-June period signified the fourth consecutive quarter of growth of 0.6 per cent or above in the euro zone's second largest economy, auguring well for a wider European upturn.

Recent data showed French consumer spending posted its biggest monthly rise in eight years in June.  France also performed better than Italy, which recorded only 0.3 per cent growth in the second quarter.

European Union statistics body Eurostat is to issue a flash estimate of second-quarter GDP for the single currency zone tomorrow, and economists expect growth to reach 0.6 per cent.