German Economy Expands, France Flat

France’s National Institute for Statistics and Economic Studies released data that showed that France’s GDP expansion in the past quarter was flat. The numbers were expected to be worse, as almost every other nation in the eurozone has reported contraction.

The INSEE reported:

In 2012 Q2, French gross domestic product (GDP) in volume held steady (0.0%).

Households’ consumption expenditure slightly declined (–0.2% after +0.2%), while gross fixed capital formation (GFCF) increased anew (+0.6%) after a step back in Q1 (–0.8%). Overall, total domestic demand (excluding changes in inventories) drove GDP on for only 0.1 point of growth after being neutral in Q1.

Imports markedly accelerated (+1.8% after +0.6%), while exports remained subdued (+0.2% after +0.1%). Consequently, foreign trade balance contributed again negatively to GDP growth (–0.5 point after –0.1 point).

In Q2, changes in inventories contributed positively to GDP growth: +0.3 point after +0.1 point in Q2.

The figures from Germany were even more encouraging as Europe’s largest economy grew.

According to the Federal Statistical Office:

The German economy continues its growth trend at a slightly slower pace. In the second quarter of 2012, the gross domestic product (GDP) rose 0.3% — upon price, seasonal and calendar adjustment — on the previous quarter, as reported by the Federal Statistical Office (Destatis). In the first quarter of 2012, the GDP had been up +0.5%.

While neither set of numbers showed any health in the region, at least its two largest economies have held their own.

Douglas A. McIntyre