Bank of France sees Q4 GDP dip

Paris: France’s central bank said on Monday it expected the euro zone’s second largest economy to shrink by 0.1 per cent in the fourth quarter, while industrial output unexpectedly shrank in October. The Bank of France’s quarter on quarter growth forecast repeated a prediction it made in October.

The bank also said its industrial climate indicator dipped a further 1 point to 91 in a November survey, while a similar measure of sentiment in the services sector held steady at 91.

French gross domestic product grew 0.2 per cent in the third quarter, contrary to predictions that the economy would stagnate or even shrink, but economists said the outlook was gloomy.

In a separate report, national statistics office INSEE said industrial output dropped 0.7 per cent in October, the first month of the final quarter, following a 2.7 per cent drop in September.

The October figure was weaker than expected, as economists polled by Reuters had predicted a 0.3 per cent rise.

In a sign of weakness in the euro zone’s top economy. Germany’s trade surplus narrowed in October to its lowest level in over half a year as exports posted meagre growth in the face of weakening demand from the country’s recession-hit European partners.