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French economy expands faster than estimated in Q4'17

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French economy expands faster than estimated in Q4'17

The French economy expanded 0.7% in the fourth quarter of 2017 on the back of foreign and domestic demand, faster than the 0.5% growth rate recorded in the prior three months and up from a previous estimate of 0.6%, the latest data from the National Institute of Statistics and Economic Studies showed.

For full year 2017, GDP growth came in at 2.0%, unchanged from Insee's earlier estimate.

Despite a rise in wages, growth in households' purchasing power slowed to 0.2% in the quarter from 0.5% in the previous three months as prices continued to increase. For 2017, growth in purchasing power decelerated to 1.5% from 1.8% in 2016.

Total gross fixed capital formation gained 1.1% compared with 0.9% growth in the third quarter.

Final domestic demand, excluding inventory changes, contributed 0.5 percentage points to fourth-quarter 2017 GDP growth.

Exports grew 2.5% following a 1.0% rise in the third quarter, while growth in imports showed a marked slowdown to 0.3% from 2.2%.

Overall, the foreign trade balance contributed 0.7 percentage point to fourth-quarter 2017 GDP growth. Changes in inventories subtracted 0.4 point from growth.

The general government deficit accounted for 2.1% of GDP for the period under review, down 0.7 percentage point from the prior quarter.