Business

Bank of France predicts zero growth for first half

Francois Hollande
Mr Hollande has promised to focus on growth

The Bank of France has predicted zero growth in the French economy for the first six months of 2012.

Official figures for gross domestic product (GDP) for the first three months of the year are due to be released on 15 May, which is also the day of the inauguration of the new President, Francois Hollande.

Mr Hollande was elected on a platform of boosting economic growth.

The economy grew 0.2% in the last quarter of 2011.

In January, the French government halved its forecast for the whole of 2012 for 1% to 0.5%.

Also on Thursday, the statistics office Insee released worse-than-expected industrial output figures for March, which showed a 0.9% drop.

The decline was partly blamed on a 14.2% drop in energy consumption as the weather improved following a cold February.

While the Bank of France is predicting zero growth for the first three months of the year, many economists see that as a best-case scenario and are forecasting a contraction.

"We are expecting a very light contraction in the economy in the first quarter of the order of 0.1 to 0.2%," said Helene Baudchon, economist at BNP Paribas.

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