No change in sight for French jobless rate

24th March 2005, Comments 0 comments

PARIS, March 24 (AFP) - The French economy should grow slightly in the first half of 2005 but unemployment will probably remain stuck at around 10 percent, a forecast by the national statistics institute INSEE said Thursday.

PARIS, March 24 (AFP) - The French economy should grow slightly in the first half of 2005 but unemployment will probably remain stuck at around 10 percent, a forecast by the national statistics institute INSEE said Thursday.

France should post economic growth of 0.6 percent in the first three months of the year, and 0.3 percent in the second quarter, INSEE said.

Earlier estimations had forecast growth of 0.5 percent and 0.4 percent, respectively.

Regarding unemployment, the statistics service foresaw a certain "inertia" that would keep the jobless rate at 10 percent until at least the second half of the year.

It hit a five-year high of 10.1 percent in January.

Growth in purchasing power was expected to ease from 1.1 percent in the last three months of 2004 to 0.7 percent in the first quarter of this year.

The combination of those factors was expected to dampen business sentiment and incite a certain prudence, in particular in terms of investment, especially since the outlook for oil prices was uncertain.

INSEE forecast prices would range around USD 45 (EUR 34.50) a barrel in the first quarter, and USD 40 (EUR 30.70) a barrel in the second.

On Wednesday, crude oil prices slipped to USD 54.70 (EUR 42.04) a barrel in New York and to 53.45 (EUR 41.07) a barrel in London.

According to INSEE's forecast director Michel Devilliers, the French economy would have to post growth averaging 0.53 percent in the last two quarters to reach the lower range of the government's 2005 forecast of 2.0 percent.

© AFP

Subject: French News

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