PARIS Dec 28 France trimmed its third-quarter
growth reading to 0.1 percent from 0.2 percent previously, yet
the timid return to positive territory provided some comfort as
the country struggles to revive exports and stem job losses.
The INSEE national statistics institute also adjusted its
prediction for full-year 2012 gross domestic product growth to
0.1 percent from 0.2 percent previously in its release of final
The return to growth in the third quarter, as household
consumption bounced back, came after a 0.1 percent dip in
second-quarter GDP and confounded initial expectations that
Europe's No. 2 economy could enter recession by the end of the
Consumer spending rose 0.2 percent in November in
inflation-adjusted terms, other INSEE data showed, beating
expectations for zero growth and bouncing back from a 0.1
percent dip in October. The rise was mainly due to higher
spending on household furnishings and energy.
BNP Paribas economist Dominique Barbet said that while the
GDP revision was bad news, the retail sales rise was a nice
surprise. "Despite the revision, we continue to forecast the
full year (GDP) growth at 0.1 percent, although the risk is now
greater to get a lower figure than a higher one," he said.
Socialist President Francois Hollande is banking on growth
of 0.8 percent next year - a level most analysts view as
over-optimistic - to meet a public deficit target that is being
seen as a test of his fiscal credibility.
INSEE predicted last week that the economy would grow a
meagre 0.1 percent in the first and second quarters of next year
after likely growth of 0.1 percent this year, a level that is
below the government's 0.3 percent target and down from 1.7
percent growth in 2011.
With a sickly industrial sector holding back exports and
high unemployment weighing on household spending, France's 2
trillion-euro economy had not posted positive growth since the
third quarter of 2011.