France’s economy contracted by 13.8% in the second quarter

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The French economy shrank at a record pace for the post-World War II period of 13.8% in the second quarter, as consumption, investment and trade collapsed under public isolation measures aimed at containing the Covid-19 pandemic, although the decline came in slightly less than expected.
Deflation in the second largest economy in the euro area exceeds the rate of 10.1% recorded by Germany, where the authorities controlled a rise in the death rate Covid-19 and did not have to impose strict public isolation measures, as happened in France.
Strict public isolation was imposed in France until May 11, with non-essential stores closed and procedures gradually phased out during the second quarter, with cafes and restaurants allowed to open on June 2.
But the contraction was not severe, as the National Institute for Statistics and Economic Studies expected a contraction of 17% earlier this month, while analysts polled by Reuters identified a decrease of 15.3%.
“Not bad! We were expecting -16%, but the removal of the isolation saved the matter,” said Ludovic Sopran, chief economist at Allianz.
The National Institute also revised downward to 5.9% from the 5.3% drop in GDP in the first quarter, which included two weeks of general isolation measures imposed on March 17.
This is the third consecutive decline in GDP, in a recession that began in the last quarter of last year, when strikes nationwide deducted 0.2% of the national product.
Data showed, on Friday, that household spending fell 11%, that corporate investment fell 17.8%, that exports fell 25.5%, and imports 17.3%.
(Reuters)





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