France in for modest growth: statistics body

23rd June 2010, Comments 0 comments

France can expect modest economic growth this year of 1.4 percent, the official target and sufficient to check a rise in unemployment, the statistics body INSEE said Wednesday.

After a disappointing first quarter, when gross domestic product expanded only 0.1 percent, the economy should show growth of 0.5 percent in the second quarter.

The final two quarters should see growth of 0.4 percent, according to INSEE.

It said that after contracting 2.5 percent in 2009, French economic momentum of 1.4 percent in 2010 will be slower than that of Germany but slightly above the eurozone average.

"This pace should be sufficient to stabilise unemployment. At the end of the year the current jobless rate of 9.5 percent of the workforce is expected to be maintained," INSEE predicted.

The agency said household spending, the traditional driver of the French economy, should rise 1.2 percent this year, an improvement over the 0.5 percent recorded in 2008 and the 0.7 percent in 2009 but less than the pre-crisis annual gains of 2.5 percent in 2006 and 2007.

Inflation, after stagnating in 2009, should come to 1.6 percent this year, according to INSEE. The government foresees inflation in 2010 of 1.2 percent.

© 2010 AFP

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