Reply #76: French growth tumbles in Q4, govt sees 2009 in red

[Ghost Dog]

PARIS, Feb 12 (Reuters) - France's economy shrank at the fastest pace in 34 years in the fourth quarter of 2008 as business investment and exports collapsed, prompting the government to say it expected negative growth this year.

National statistics office INSEE said on Thursday gross domestic product fell 1.2 percent in the last three months of last year compared with the previous quarter, more than expected, bringing economic growth for 2008 to 0.7 percent.

Economists had predicted a quarterly fall of 1.1 percent after growth of 0.1 percent in the third quarter.

"This bad figure reflects in large part a very significant destocking by companies, which indicates a wait-and-see attitude in the face of uncertain growth and the crisis in the automobile sector," Economy Minister Christine Lagarde said in a statement.

The figures were published a day early after a group of statisticians leaked them in protest at the government's early announcement of some statistics.

The announcement by the euro zone's second biggest economy came a day before fellow heavyweights Germany and Italy were expected to announce their own steep GDP falls, and it followed a similarly grim statement by Spain.

Spain's economy shrank 1 percent in the fourth quarter, its biggest quarterly fall in 15 years, pushing it into recession for the first time since 1993.

Lagarde said she expected GDP to fall by at least 1 percent in 2009 but took heart from the fact that household consumption, a key driver of French growth, had held up in the last quarter of 2008, rising 0.5 percent.

/... http://www.reuters.com/article/marketsNews/idUKLC111958...