French Q3 GDP Rises 0.5%

The French economy expanded by 0.5% in the third quarter, a slight slowdown from the pace of growth three months earlier, while consumer spending weakened in October, the INSEE national statistics agency said on Wednesday.

Third quarter gross domestic product growth reading of 0.5% was in line with an earlier estimate, and followed growth of 0.6% in the second quarter, news outlets reported.

However, export growth decreased to 0.7% from 2.5% in the second quarter, realizing expectations that a stronger euro might eat into the country’s trade.

October consumer spending fell by 1.9% from the previous three months, which INSEE partly attributed to a decline in spending on gas and electricity due to warmer-than-average temperatures, and less money spent on household goods.

Still, Claus Vistesen, economist at Pantheon Macroeconomics, noted that “these initial data are subject to significant revisions, but they paint a picture of a French economy with growth comparable to that of Germany.” He added: “This is not something we have been able to say for a long time.”

France, the second-biggest economy in the eurozone, is forecast by President Emmanuel Macron’s government to grow 1.7% in 2017, which would mark its strongest performance since 2011, Reuters said.

“French assets have been trading on a slight premium to the rest of Europe, and that has partly reflected the fact that investors have been enthused by the start of Macron’s presidency,” said Gautam Batra, head of investments at Mediolanum Asset Management, which manages around €40 billion ($47.5 billion) of assets.