* INSEE trims Q3 growth reading to +0.1 pct from +0.2 pct
* Revision due mainly to revaluation of industrial stocks
* Govt will reassess growth target by April -finmin
* Consumer spending rises 0.2 pct m/m in November
By Catherine Bremer
PARIS, Dec 28 France scaled back the extent of a
surprise return to economic growth in the third quarter to 0.1
percent from a previous reading of 0.2 percent as the government
struggles to revive exports and stem job losses.
The weakness of the euro zone's second biggest economy will
add to the government's difficulties in meeting EU budget rules.
Socialist President Francois Hollande is banking on 2013 growth
of 0.8 percent to achieve a financial target that the
International Monetary Fund says is over-optimistic.
Finance Minister Pierre Moscovici said that although he
currently saw no reason to revise the target, the government
would review it before it sends its long-term deficit reduction
strategy to the European Commission in April.
"That's when we will see if this growth outlook is or is not
credible or valid," Moscovici told Reuters during a visit to
Paris' Orly airport.
The INSEE national statistics institute nudged down its
estimate of 2012 gross domestic product growth to 0.1 percent
from 0.2 percent when it released the final third quarter data.
Household spending and a rebound in exports helped the
economy resume growth after a 0.1 percent dip in second-quarter
GDP. 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.
But a downward adjustment in the value of industrial stocks
and a 0.6 percent slide in business investment, after a 0.5
percent rise in the second quarter, pulled down the third
quarter and 2012 growth figures.
"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," said BNP Paribas economist Dominique Barbet.
Hollande admitted last week that 2013 would be a "difficult
year" with near-zero growth in the first six months and
still-rising unemployment, but insisted he could cut the public
deficit to below a European Union ceiling of 3 percent of GDP.
INSEE predicted in its quarterly economic outlook last week
that the economy would grow just 0.1 percent in the first and
second quarters of next year after likely growth of 0.1 percent
this year, weaker than the government's 0.3 percent target and
down from 1.7 percent growth in 2011.
It expects new orders from Germany and trade partners beyond
the euro zone to spur a pick-up in exports.
But "uncertainty remains high, confidence is low," Barclays
Capital economist Francois Cabau said.
France's 2 trillion euro ($2.6 trillion) economy had not
grown since the third quarter of 2011. Hollande plans tax
rebates from next year to reduce companies' labour costs, but
critics say the measures do not go far enough.
Fitch ratings agency this month forecast France's 2013
growth at 0.3 percent, well below the 0.8 percent the budget is
based on, as it affirmed the country's AAA rating, a badge both
Standard & Poor's and Moody's removed from France this year.
The number of people out of work rose for the 19th
consecutive month in November to reach a nearly 15-year high,
labour ministry data showed on Thursday.
"For 2013, the question is whether the recovery seen in most
confidence indices ... will help support economic recovery as
early as the first quarter. We doubt so, because of the fiscal
tightening in France and the ongoing economic weakness in
neighbouring countries," Barbet wrote in a research note.