French growth forecast 'ambitious, maybe a bit audacious'

20th June 2010, Comments 0 comments

France's economy and finance minister said Sunday the country's 2011 growth forecast of 2.5 percent is "ambitious and maybe a bit audacious", but would be maintained for the time being.

"I'm sticking to it because it is too early in the year to revise it," Christine Lagarde said in talks with RTL/Le Figaro/LCI journalists.

Lagarde said she was waiting and hoping for good growth results for the second quarter of 2010.

The Bank of France said earlier this month that the French economy would grow by 0.5 percent in the second quarter, maintaining an earlier forecast for the country's growth.

The bank had estimated that in the first quarter of this year, the French economy would grow by 0.4 percent on a quarterly basis, but a first estimate from the official statistics institute showed that growth was only 0.1 percent.

The government is counting on the economy growing by 1.4 percent for the whole of this year, having experienced the severest recession in 2009 since World War II with a contraction of 2.5 percent.

Sources close to Lagarde said that the target for 2010, which requires average growth of 0.4 percent in each of the last three quarters of the year, had not been undermined by the weak growth figure for the first quarter.

The forecast by the government is in line with an estimate from the International Monetary Fund that the French economy would grow by 1.5 percent this year and by the European Commission, which foresees growth of 1.3 percent.

The official statistics office INSEE is to publish its second quarter estimate on August 13. The government will then adjust its own forecast.

© 2010 AFP

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