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By James Mackenzie
PARIS, May 11 (Reuters) - French industrial output fell more sharply than expected in March as big drops in production of electronic goods, energy and food outweighed a rise in the transport equipment sector, data on Monday showed.
National statistics office INSEE said industrial output fell 1.4 percent in March, much deeper than the 0.5 percent decline forecast by economists polled by Reuters. The February figure was also revised to show a 0.9 percent fall after an originally reported drop of 0.5 percent.
Output in the first three months of the year was down 15.5 percent compared with the same period a year earlier and was down 6.9 percent compared with the preceding three month period.
The figures underlined the impact of a wave of plant closures and production stoppages over recent months.
But after a stabilisation of German output in March reported last week and positive signs from recent purchasing managers' surveys, some economists pointed to signs of a slowing in the freefall seen since the financial crisis broke last year.
"It's worse than forecast, but it doesn't necessarily cast doubt over all the scenarios for an improvement and end of the recession," said Jean-Louis Mourier, an economist at investment advisers Aurel BGC in Paris.
The data comes ahead of first quarter gross domestic product figures due on Friday, which are expected to show a decline of 1.2 percent after a 1.1 percent drop in the fourth quarter.
WORST OF THE CRISIS
The government's GDP forecast is for a 1.5 percent drop in 2009 but the IMF, which sees a 3.0 percent fall and the OECD, which expects a 3.3 percent decline, are less optimistic.
Monday's data showed manufacturing industry suffered a 1.1 percent monthly decline, with falls in food and agriculture, energy and electronic equipment production. The only positive note was a 1.3 percent rise in transport equipment output.
(For a full table of industry output data, please double click on [ID:nPAB004780]
But the falls were much weaker than the dramatic double digit monthly declines seen in sectors like automobiles and machine engineering at the turn of the year.
"I think that even though the first quarter figure is as dire as the fourth quarter figure, the figures still support the view that the worst of the crisis was at the turn of the year," said Joost Beaumont, an economist at Fortis in Amsterdam.
The government, facing steadily rising jobless rolls and a wave of labour protests that have ranged from wildcat "bossnappings" to mass union-backed street demonstrations will be happy to take any positive signs. (For more analyst comment, please double click on [ID:nLA724083] (Additional reporting by Vickey Buffery and Sophie Hardach, editing by Mike Peacock)