The French economy ground to a halt in the third quarter, prompting banks to lower their forecasts for growth across Europe on Friday. The surprisingly bad news also dealt the center-right government a blow as campaigning gains pace, with a presidential election just six months away.
France had been expected to grow by an annualized 0.5 percent in the third quarter after posting large gains in the second quarter. Along with declining unemployment, continued growth in France was expected to help the Gaullist governing party to rally voters. Instead French output was unchanged during the third quarter, while industrial production fell, reinforcing a picture of the French economy as somewhat plodding and unlikely to repeat the exceptional growth spurt in the second quarter anytime soon. |