French economy expanded less than initially estimated

The French economy, the euro region’s second largest, grew at a weaker pace than previously estimated in the third quarter as companies cut spending.

Gross domestic product rose 0.3 per cent from the second quarter, when it fell 0.1 per cent, French statistics institute Insee in Paris said today. It had previously reported a gain of 0.4 per cent. In the year, the economy expanded 1.5 per cent, down from 1.7 per cent in the previous quarter.

The French economy is probably already in recession, with output shrinking this quarter and next, Insee said last week.

While French business confidence dropped to the lowest in 1 1/2 years in December and manufacturing contracted, government leaders have refused to use the word recession, saying France is in a “slowdown” or an “air pocket.”

French investment growth slowed to 0.2 per cent in the third quarter from 0.6 per cent in the previous three months, today’s report showed.

Consumer spending increased 0.3 per cent after dropping 0.6 per cent in the second quarter and exports advanced 0.8 per cent, up from 0.7 per cent.

The weaker-than-initially-estimated growth in the third quarter was due to revisions to industrial production as well as to new figures on company revenues, Insee said.