FRANCE

摘要

The preliminary release of the Q2 national accounts showed GDP growth stalling in the three months to June, following a 0.7% (q-o-q) jump in Q1. This has raised concerns over momentum in the economy going into H2 2016. To be fair, activity in Q1 was partly supported by accommodation and ticket bookings ahead of the Euro 2016 football championships (which were hosted by France at the end of June). Household consumption in Q2 was the main factor behind the zero-growth outturn; it, too, did not grow after a 1.2% quarterly surge in Q1, as goods and services spending decelerated. Energy consumption was relatively steady, however. Domestic demand as a whole did not fare well: business investment declined by -0.2% (q-o-q) as payback for a buoyant performance in the previous two quarters, particularly Q1 's 2.1 % jump. The weakness in capital spending was evident in construction, manufacturing and services, while the draw-down in inventories also subtracted from overall activity as firms chose not to boost production. The worry now is for the economy going into the latter part of this year. The government is predicting a 1.5% growth rate for 2016 as a whole. GDP grew by 1.3% (y-o-y) in Q1 and 1.4% in Q2 and would have to trend somewhat higher to reach the target rate. However, the UK Brexit vote has hit exporter sentiment reliant on demand from its neighbour. Moreover, the Nice terrorist attack on Bastille Day hit right at the heart of France's tourism industry, not to mention citizens' security fears. Our panel's GDP forecast has been downgraded.