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France expected to see slower growth in 2018 due to "Yellow Vests" movement: Insee

Source: Xinhua| 2018-12-19 05:14:24|Editor: yan
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PARIS, Dec. 18 (Xinhua) -- France, eurozone's second biggest economy, would record slower growth this year as month-long blockades of the country's motorways and streets protests at the weekends during pre-Christmas shopping took a toll to domestic economy, Insee statistics institute forecast on Tuesday.

In its economic outlook, Insee lowered its estimate for the whole year's economic performance by two percentage points to 1.5 percent.

"Affected by the social movement of the "Yellow Vests," the quarterly growth was seen decelerating to 0.2 percent in the last three months of 2018 from a previous estimate of 0.4 percent.

Insee forecast the rate would then rise to 0.4 percent in the first quarter next year on expected recovery of consumer spending, before easing to 0.3 percent in the second three months of the year.

Households consumption was set to register a moderate pace at the end of this year before gaining momentum in early 2019 as a result of the measures the government had announced to bolster purchasing power and quell public anger over soaring living costs.

As to business investment, the French statistics agency forecast stable trend by year-end "due to a fall in expenditure on manufactured goods." Looking to next year's performance, It saw 0.6 percent growth per quarter in the first half.

With the labor market showing signs of slowing, the employment rate would stand at 9 percent in the spring of 2019. The figure was put at 9.1 percent at the end of this year.

"The duration and consequences of the "Yellow Vests" social movement remain very uncertain ... The modalities for implementing the purchasing power support measures announced on Dec. 10 are not yet precisely known...," Insee said.

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