France may enter recession in 2012, says INSEE
Latest revisions to France’s economic growth figures have led statistics organisation INSEE to suggest the country will enter recession in 2012 after a revision left Q3 growth at a paltry 0.3%.
INSEE, France’s National Institute of Statistics and Economic Studies, said the 0.3% figure was up on the -0.1% recorded for the second quarter.
However, this represents a decrease from a provisional growth figure of 0.4% previously estimated for the quarter.
The economy is struggling with a sharp fall in household disposable income. Wages per capita are actually decreasing, while the government’s austerity budget measures have resulted in sharply rising taxes.
Purchasing power by one measure declined through the quarter by -0.1%, after rising by 0.4% in the previous quarter, INSEE stated.
Looking at the figures, Reuters reported that the downward revision of third quarter growth followed estimates that fourth quarter 2011 and first quarter 2012 growth will be even slower.
Even if the economy stabilises, this will have to be put in context of record numbers of job-seekers and rising unemployment, Reuters added.
Also of concern is the slowdown in corporate investment. It did grow, but at a slower rate than the previous quarter.
The next quarterly figures from INSEE are due for publication on 28 March 2012.