Financial News: French GDP Growth Beats Expectations

French GDP Growth Beats Expectations

(RTTNews) - The French economy logged a faster-than-expected growth in the second quarter on recovering household spending, official data showed Wednesday.

Gross domestic product grew 0.3 percent from a quarter ago, the statistical office INSEE showed on Wednesday. The economy was expected to grow at a steady pace of 0.1 percent in the second quarter.

The expenditure-side breakdown of GDP showed that final domestic demand provided zero contribution to growth.

Household consumption rebounded slightly by 0.1 percent, following a 0.3 percent drop. At the same time, government spending climbed 0.2 percent, the same pace as seen in the previous period.

Meanwhile, gross fixed capital formation fell 0.3 percent after a 0.1 percent drop.

Foreign trade kept contributing negatively to GDP growth in the second quarter. Net trade contributed -0.2 points as exports rebounded only 0.2 percent following a 1.1 percent decrease, while growth in imports accelerated to 0.8 percent from 0.3 percent.

Finally, changes in inventories made once again a positive contribution to GDP this quarter, data showed. The contribution was 0.5 points compared to 0.7 points in the first quarter.

Another data showed that household spending growth accelerated in June on higher consumption of energy and manufactured goods. Household consumption grew 0.6 percent from the prior month, following a 0.1 percent rise in May.

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