The French economy recovered at a faster-than-expected pace in the first quarter underpinned by consumption and investment, first estimate from the statistical office Insee showed on Friday.
Gross domestic product grew 0.4 percent sequentially, reversing a revised 1.4 percent fall in the fourth quarter of 2020 and exceeded the economists’ forecast of +0.1 percent.
Nonetheless, the statistical office said the economic rebound was limited, as GDP was still 4.4 percent below its fourth quarter 2019 level.
The expenditure-side breakdown of GDP showed that growth in gross fixed capital formation improved to 2.2 percent from 1.3 percent and households’ consumption expenditure picked up 0.3 percent, in contrast to a fall of 5.7 percent in the previous quarter.
Final internal demand, excluding inventory changes made a positive contribution of 0.9 points to GDP growth.
Exports declined 1.5 percent and imports decreased 0.1 percent. Overall, foreign trade made a negative contribution to GDP growth by -0.4 points versus +1.2 points in the previous quarter.
Finally, the contribution of inventory changes to the growth of the GDP was null this quarter, data showed.
Early this month, the finance ministry cut its 2021 GDP growth forecast to 5 percent from 6 percent after the government extended the restrictions related to the coronavirus pandemic.