French economy stagnates in second quarter
French economic growth ground to a halt as household spending shrank in the second quarter, raising pressure on the government to announce cutbacks to convince turbulent markets it will deliver on debt reduction targets.
France's statistics office said GDP growth was zero in the April-June period versus first quarter growth that, at 0.9 percent, was the best in almost five years.
The main cause was a drop in household consumption, which was down 0.7 percent from the first quarter, a particularly worrying sign for an economy that, unlike Germany's, is heavily reliant on domestic demand.
The French report comes ahead of similar readout for Germany and the euro zone on August 16. Barclays' economics department said the French figure could drag the euro zone result lower than a consensus forecast of 0.3 percent.
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