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France sees zero GDP growth in 2011 Q2: Insee

2011-08-12 10:03:05 GMT2011-08-12 18:03:05(Beijing Time)  Xinhua English

PARIS, Aug. 12 (Xinhua) -- The European second largest economy France didn't record any GDP growth over the second quarter of this year after a growth of 0.9 percent in the first quarter, the national statistics bureau Insee said Friday, owning the level-off to slack household consumption.

Households' consumption expenditure stepped back 0.7 percent after an increase of 0.4 percent, which made the total domestic demand impact the GDP by 0.2 points after a positive 0.5 points contribution in the first quarter, Insee figure showed.

With decreased imports, foreign trade balance was the positive contributor to the second quarter GDP while quarterly changes in inventories were neutral.

During the April-June period, "every industries' production decreased, expect in food products," Insee said, which therefore resulted in a 0.6 percent fall in manufactured production versus a 2.9-percent increase in the first quarter, which was "the sharpest increase since summer 1968."

French shares CAC 40 fell again in the morning session at the release of the unfavorable GDP figures. At 9:30 a.m. (0730 GMT), the index decreased by 1.12 percent to 3,055.13 points.

As a response, Finance Minister Francois Baroin admitted the quarterly growth "disappointing" on local radio RTL, but said the economic activities were in recovery and maintained the previous growth target.

CAC 40 shares picked up a little following Baroin's confident expression and turned red.

France expects the 2011 annual growth to reach 2 percent, and then to 2.25 percent in 2012.

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