French economy shrinks 0.1% in third quarter as exports slump
France's economy unexpectedly contracted 0.1% in the third quarter, missing forecasts for slight growth, as exports fell sharply. Transport equipment exports declined 9.1%, while household consumption rose 0.4%.
The French economy contracted 0.1 per cent in the third quarter, missing analysts' expectations for slight growth, as lower exports weighed on the euro zone's second-biggest economy, official preliminary data showed on Friday.
Analysts polled by Reuters had expected a 0.1 per cent increase over the third quarter, after no growth in the previous three months.
The economy was affected by a fall of 4.5 percentage points in exports, to minus 1.7 per cent, mainly linked to a 9.1 per cent decline in exports of transport equipment, with aerospace as the main negative driver, versus 20.8 per cent growth in the second quarter.
Gross fixed capital formation, national accounts' main measure of investment, fell 0.6 per cent in the third quarter, extending a 0.5 per cent decline in the second, as construction and transport equipment investments dragged on business spending.
Household consumption, however, continued to rise by 0.4 per cent in the quarter, following a 0.2 per cent increase in the three months prior. "Consumption of transport equipment is on the rise again, driven in particular by purchases of electric vehicles," statistics office Insee said. Energy consumption also rebounded, rising 1.2 per cent after a 2.0 per cent fall in the previous quarter, due to increased spending on electricity, Insee said.
France has been hit by a wave of protests in the final weeks of the quarter, which began with small student demonstrations in suburban Paris in September to denounce school conditions and swiftly broadened into a wider protest against the government's economic policies.