The second largest economy in the monetary union grew strongly in the third quarter. But what happens next?
Dhe French economy grew at record speed in the summer and has recovered somewhat from the Corona crisis. The gross domestic product (GDP) rose between June and September by 18.2 percent compared to the previous quarter, as the national statistics office Insee announced on Friday.
Economists surveyed previously had expected an average increase of 15.4 percent after the economic output of the monetary union’s second-largest economy after Germany had fallen by 13.7 percent in the spring.
However, the latest containment measures due to rising corona infections are likely to slow the economy towards the end of the year. France’s Finance Minister Bruno Le Maire therefore expects the fourth quarter to be difficult. In 2020 as a whole, GDP will fall by eleven percent, the minister told the radio station France Inter. He is hoping for decent economic growth in the next year.
Domestic demand was almost the only source of momentum in the third quarter. After the long lockdown, consumers increased their consumer spending by a good 17 percent, and corporate investments rose by more than 20 percent. Exports climbed by around 23 percent, but had also slumped sharply by almost 26 percent in the spring. Compared to the previous year’s level, the total economic output in Germany’s neighboring country is still 4.3 percent behind.