The FINANCIAL — France’s economic growth accelerated in the first quarter, official data showed on May 13, as the country and the wider eurozone show signs of snapping out of the economic torpor that has gripped the currency area, according to Nasdaq.
Gross domestic product in the eurozone’s second-largest economy was 0.6% higher in the first quarter of the year than in the final three months of 2014, national statistics agency Insee reported. That marked an acceleration from the stagnation recorded in the previous quarter, and was the strongest showing since the second quarter of 2013.
The French economy has been largely stagnant for years, undercutting President François Hollande’s push to revive hiring by cutting corporate taxes.
The numbers from France are the first of several GDP releases Wednesday that are expected to show the strongest expansion across the eurozone in years.
The eurozone economy returned to growth in the second quarter of 2013, having contracted for the previous six quarters. But quarter-to-quarter growth has been anemic, leaving the jobless rate close to its record high, and making it difficult for governments and households to reduce high levels of debt.
With the economy barely avoiding stagnation and consumer prices in decline, the European Central Bank in March launched a massive program to buy government bonds and stimulate growth and inflation.
A fall in oil prices and a weakening of the euro against the dollar are also delivering a boost to parts of the economy, particularly to eurozone exporters.
But policy makers still worry the currency area is at risk of a slide into deflation, or a situation in which consumers and businesses cut back on spending because they expect prices to fall further, the outcome being a decline in output and employment that pushes prices even lower.
The monetary union is also plagued by persistent doubts about Greece’s ability to remain inside the currency area.
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