Compared with the previous three months, the French economy was flat in the third quarter of 2006, as sustained consumption was offset by poor results in foreign trade and inventory reduction, a second estimation released Nov. 21 by the national statistics institute Insee showed.
The forecast confirmed an Insee estimate earlier this month which surprised economists who had expected third quarter growth of 0.5%, and Insee itself which had expected an increase of 0.6% in a note published in early October.
In the third quarter, household consumption contributed 0.3 percentage points to overall growth, while investment by business and individuals added 0.1 points.The foreign trade balance trimmed 0.2 points from the total, however, while variations in inventories cut another 0.3 points.
On Nov. 21, French Finance Minister Thierry Breton forecast a "very good fourth quarter", with growth of 0.6%-0.8% from the previous three-month period. Full-year growth would reach 2%-2.5%, Breton predicted.
Copyright Agence France-Presse, 2006