PARIS, April 10 (Reuters) - Factory output in France fell less than expected in February, according to data on Friday which suggested that production may be stabilising and the economy may not endure as much pain as some of its neighbours.
Output fell 0.5 percent from the previous month, far less than economists' consensus forecast of a 1.1 percent drop, and it dropped 13.5 percent on the year.
The performance of Europe's second-biggest economy stood out after Germany on Thursday reported a 23.2 percent annual fall in output, its steepest loss since reunification. Italy also suffered record falls in industrial production.
French statistics office INSEE revised its January output figure to -3.9 percent from -3.1 percent. However, economists said February's data was consistent with signs from economic surveys that the worst may be over for production following massive destocking late last year.
"French industrial output has stabilised at a low level but if you compare it with Germany where they saw a 23.2 percent year-on-year fall, the French data is not as weak," said Alexander Law, an economist with researchers Xerfi.
"That's because destocking began immediately in France when demand started to drop. There was massive destocking and now it really can't go much lower," he said.
INSEE also said that consumer prices in France rose 0.2 percent on the month in March while a separate statement from the Budget Ministry showed that the budget deficit stood at 29.9 billion euros at the end of February.
Many markets in Europe were shut on Friday for the Easter holiday. (Reporting by Tamora Vidaillet, Estelle Shirbon and Sophie Hardach; Editing by David Stamp)