French economy unexpectedly contracts as exports slump in third quarter
SPY•France’s economy contracted 0.1% in the third quarter, missing analysts’ expectations for 0.1% growth, as exports fell 1.7%. Investment declined 0.6%, while household consumption rose 0.4%.
1. Exports and investment fall
France’s economy contracted 0.1% in the third quarter, after no growth in the previous quarter. Analysts had expected 0.1% growth. Exports fell to -1.7%, with exports of transport equipment down 9.1%; aerospace was the main negative driver. Gross fixed capital formation fell 0.6%, following a 0.5% decline in the second quarter, as construction and transport equipment investments weighed on business spending.
2. Consumption rises
Household consumption increased 0.4%, following a 0.2% rise in the previous quarter. Insee said transport equipment consumption rose again, driven in particular by electric vehicle purchases, while energy consumption rebounded 1.2% after falling 2.0%. Protests against school conditions and the government’s economic policies took place in the final weeks of the quarter.
