(Boursier.com) – No surprise for French growth in the second quarter. According to the estimate of INSEE, the gross domestic product (GDP) was unchanged in the three months ended in late June, in line with expectations. The government recently lowered its forecast for 2014 and 2015 and expects a GDP growth of 0.4% this year and 1.0% next year, while previously planned 1.0% and 1.7% .
Household consumption expenditure rebounded (+0.4% after -0.6%), while gross fixed capital formation (GFCF) continued its decline (-1 1% after -0.9%). In total, final domestic demand excluding inventories up slightly: it contributes 0.1 points to GDP growth (-0.4 percentage points after the first quarter)
Derailed
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Imports slowed (+0.4% after +0.8%), but slightly less than exports (+0.1% after +0.6%). Therefore, net exports made a negative contribution to the activity (-0.1 points), details INSEE. Finally, changes in stocks of companies have a neutral contribution to the activity (0.0 points, 0.5 points after the first quarter).
Forecasts lowered
The government has announced a public deficit this year to 4.4% of GDP instead of 3.8% previously expected, from 4.1% in 2013 according to the latest review by INSEE. The slippage would be more than 6 billion euros this year and more than 25 billion in 2015 when ledéficit would hardly reduced to 4.3% instead of 3% previously promised. It would be in the bar end of 2017.
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