2021.10.2906:08:00UTC+00France Q3 GDP Growth Accelerates More Than Expected

The French economy grew more than expected in the third quarter on robust household spending and exports, the first estimate from the statistical office Insee showed on Friday.

Gross domestic product grew 3 percent sequentially, much faster than the 1.3 percent expansion logged in the second quarter and the economists' forecast of +2.1 percent.

GDP almost returned to its pre-crisis level and was just 0.1 percent below its fourth quarter 2019 level.

The expenditure-side breakdown showed that household spending advanced 5.0 percent after rising 1.3 percent, contributing +2.5 points to GDP growth this quarter. Likewise, government expenditure growth rose to 3 percent from 0.7 percent.

Meanwhile, gross fixed capital formation was down 0.1 percent after climbing 2.5 percent a quarter ago.

Growth in exports improved to 2.3 percent from 1.2 percent in the previous quarter, while imports were virtually stable after gaining 1.7 percent. Consequently, foreign trade contributed to GDP growth by +0.6 points.

Finally, the contribution of inventory changes to GDP growth was negative this quarter, by 0.9 points.

In a separate communiqu?, the Insee said household consumption decreased unexpectedly by 0.2 percent in September, in contrast to the 0.7 percent rebound in August. Spending was expected to grow 0.3 percent.

This slight decrease was mainly due to the clear 1.5 percent fall in food consumption. Energy consumption slid 0.1 percent.