With the gradual easing of restriction to curb the spread of coronavirus, the French economy recovered at a faster than expected pace in the third quarter, preliminary data from the statistical office Insee showed on Friday.
Gross domestic product expanded 18.2 percent after logging a sharp 13.7 percent contraction in the second quarter. Economists had forecast a sequential growth of 15.4 percent.
Nevertheless, GDP remained well below the level it had before the health crisis. Compared to its level in the third quarter of 2019, GDP was 4.3 percent lower, the Insee reported.
All components of domestic demand rebounded sharply in the third quarter. Household consumption expenditure surged 17.3 percent, which was close to its pre-crisis level.
General government expenditure advanced 15.4 percent sequentially. At the same time, total gross fixed capital formation grew 23.3 percent.
Foreign trade also rebounded this quarter, especially exports, which climbed 23.2 percent. Imports increased by 16 percent. Overall, foreign trade made a positive contribution to GDP growth by 1.2 points.
Finally, changes in inventories contributed negatively to GDP growth by 1.9 points.
Earlier this month, the Bank of France said the economy expanded 16 percent sequentially in the third quarter. However, economic output was 5 percent below the pre-crisis level, the central bank estimated.
According to IMF, France’s GDP will shrink 9.8 percent this year before rebounding 6 percent in 2021.
Another report from Insee showed that household consumption declined 5.1 percent on month in September, in contrast to a 2.2 percent rise in August. Spending was forecast to fall 1 percent in September.
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