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Bank of France trims first-quarter GDP growth estimate to 0.3 percent

Published 04/11/2018, 03:46 AM
Updated 04/11/2018, 03:50 AM
© Reuters. Facade of the Bank of France "Banque de France" headquarters in Paris

PARIS (Reuters) - France's economy grew less quickly in the first quarter than previously thought, the Bank of France said on Wednesday, largely due to a slowdown in manufacturing activity.

The central bank cut its growth estimate to 0.3 percent from 0.4 percent. A source there said it would not be altering its full-year forecast for now.

The French data mirrors a broader dip in the euro zone economy. On Monday, European Central Bank Executive Board member Benoit Coeure said the bloc was experiencing a largely anticipated correction, rather than a slowdown, after growth rates reached multi-year highs.

The Bank of France's business sentiment indicator for the manufacturing industry fell to 103 points in March from 105 in the previous month, with a sharp decline in orders as deliveries slowed.

Business leaders expected industrial production to grow at a moderate pace in April, the bank said.

Its equivalent indicator for the country's services sector held steady at 103 points, hovering around its highest since May 2011, and the central bank said staff levels continued to increase fairly rapidly.

Official readings of business and consumer confidence have scaled multi-year peaks since President Emmanuel Macron was elected last May on a ticket to reform the economy and help businesses.

© Reuters. Facade of the Bank of France "Banque de France" headquarters in Paris

Strong growth since Macron became president has given the former investment banker a tailwind as he seeks to modernise the euro zone's second biggest economy, and his government will be keen to maintain that economic momentum at a time of growing domestic discontent towards his reform agenda.

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