EU commission raised French outlook, cut Germany
Exceptionally strong Q2 triggered French forecast revision
France benefiting from air travel, tourism revival

PARIS, Sept 12 Reuters Germany39;s economic weakness is casting a flattering light on France39;s relative resilience that belies the otherwise middling performance of the euro zone39;s secondbiggest economy, economists say.

The European Commission said on Monday the two economies were on diverging paths this year with Germany forecast to be in a recession with a 0.4 contraction and France expected to grow 1.0.

With weak construction and declining construction investment weighing on Europe39;s biggest economy, Germany39;s outlook was slashed from a previous forecast for 0.2 growth while France was upgraded from 0.7.

However, France39;s improved outlook stems in no small part from a particularly strong second quarter when the economy grew 0.5 thanks to exceptionally strong exports of aircraft and the delivery of an ocean liner, not to mention a boost from firms rebuilding inventories.

Germany39;s not doing very well, that39;s for sure, but to say that means France is doing well would be pushing it, said Mathieu Plane with the OFCE economics think tank in Paris.

The contrasting fortunes of the euro zone39;s two biggest economies can also be explained by tailwinds working against Germany and headwinds helping France.

Germany39;s manufacturingfocused economy is struggling to adapt to being cutoff from cheap…

Leave A Comment