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| Version 5 | Version 6 |
|---|---|
| French growth forecast cut while Germany's is raised | French growth forecast cut while Germany's is raised |
| (about 7 hours later) | |
| There has been mixed news on the outlook for the eurozone's biggest economies. | There has been mixed news on the outlook for the eurozone's biggest economies. |
| The Bank of France expects the French economy to contract by 0.1% between April and June this year, having predicted that there would be zero growth less than a month ago. | The Bank of France expects the French economy to contract by 0.1% between April and June this year, having predicted that there would be zero growth less than a month ago. |
| But the German central bank has increased its forecast for German growth this year from 0.6% to 1%. | But the German central bank has increased its forecast for German growth this year from 0.6% to 1%. |
| German growth has kept the eurozone out of recession this year. | German growth has kept the eurozone out of recession this year. |
| There was zero growth in the French economy in the first three months of the year, following growth of just 0.1% in the previous quarter. | There was zero growth in the French economy in the first three months of the year, following growth of just 0.1% in the previous quarter. |
| Earlier this week, the latest set of official figures confirmed that the eurozone economy as a whole achieved zero growth in the first three months of 2012. | |
| Also on Friday, Spain again had to deny that it was about to ask for bailout funds to support its banking system. | Also on Friday, Spain again had to deny that it was about to ask for bailout funds to support its banking system. |
| The Reuters news agency quoted unnamed EU and German sources saying that the request would be made on Saturday. | The Reuters news agency quoted unnamed EU and German sources saying that the request would be made on Saturday. |
| But the Spanish government has maintained that it is waiting for reports from the International Monetary Fund and two private consultancies saying how much extra money the banking system needs. | But the Spanish government has maintained that it is waiting for reports from the International Monetary Fund and two private consultancies saying how much extra money the banking system needs. |
| In addition, reports of a meeting of the Eurogroup of finance ministers to discuss the issue have not been confirmed. | In addition, reports of a meeting of the Eurogroup of finance ministers to discuss the issue have not been confirmed. |
| Declining activity | Declining activity |
| The cut in the French growth forecast came in the Bank of France's Survey on Industry and Services for May. | The cut in the French growth forecast came in the Bank of France's Survey on Industry and Services for May. |
| It found that: "Industrial activity declined in May, in particular in the automotive and metalworking sectors." | It found that: "Industrial activity declined in May, in particular in the automotive and metalworking sectors." |
| In the services sector: "activity marked an overall decline, especially in the temporary work, transport and hotel-catering sectors". | In the services sector: "activity marked an overall decline, especially in the temporary work, transport and hotel-catering sectors". |
| On Thursday, official figures showed that French unemployment had hit 10% in the first quarter of 2012. | On Thursday, official figures showed that French unemployment had hit 10% in the first quarter of 2012. |
| Weak demand | Weak demand |
| While there was better news from Germany for the current year, the Bundesbank also cut its 2013 forecast from 1.8% to 1.6%. | While there was better news from Germany for the current year, the Bundesbank also cut its 2013 forecast from 1.8% to 1.6%. |
| Latest figures from Germany showed that its exports had dropped 1.7% in April compared with the previous month. | Latest figures from Germany showed that its exports had dropped 1.7% in April compared with the previous month. |
| The decline followed three consecutive months of gains. | The decline followed three consecutive months of gains. |
| But exports grew 3.4% compared with the same month last year, led by a 10.3% increase in exports to countries outside the European Union. | But exports grew 3.4% compared with the same month last year, led by a 10.3% increase in exports to countries outside the European Union. |
| Germany's imports fell 4.8% compared with the previous month. | Germany's imports fell 4.8% compared with the previous month. |
| "The recent escalation of the debt crisis is leaving its mark. Orders are also declining because of weaker global demand," said Juergen Michels from Citigroup. | "The recent escalation of the debt crisis is leaving its mark. Orders are also declining because of weaker global demand," said Juergen Michels from Citigroup. |
| "Exports are likely to fall further in the months ahead because of this, but we won't see a complete collapse." | "Exports are likely to fall further in the months ahead because of this, but we won't see a complete collapse." |
| Greece pain | Greece pain |
| There was more grim news from Greece, with latest growth figures showing that in the first three months of the year the country's economy contracted by 6.5% compared with the same period a year earlier. | There was more grim news from Greece, with latest growth figures showing that in the first three months of the year the country's economy contracted by 6.5% compared with the same period a year earlier. |
| The economy is struggling with the impact of tough austerity measures that have included spending cuts and tax rises, and with an unemployment rate that is now above 20%. | The economy is struggling with the impact of tough austerity measures that have included spending cuts and tax rises, and with an unemployment rate that is now above 20%. |
| Consumer spending in the quarter fell by 7.5% from the year before, while gross capital investment sank 21.3%. | Consumer spending in the quarter fell by 7.5% from the year before, while gross capital investment sank 21.3%. |
| Greece is going to the polls on 17 June, in an election that is seen as key to whether the country remains in the eurozone. | Greece is going to the polls on 17 June, in an election that is seen as key to whether the country remains in the eurozone. |
| Italy production | Italy production |
| Figures from Italy on Friday, showed that industrial production in the country declined by more than expected in April. | Figures from Italy on Friday, showed that industrial production in the country declined by more than expected in April. |
| Data agency Istat said that production had fallen 1.9% compared with the previous month. | Data agency Istat said that production had fallen 1.9% compared with the previous month. |
| Compared with the same month last year, industrial production was down 9.2%, which was its worst annualised drop since November 2009. | Compared with the same month last year, industrial production was down 9.2%, which was its worst annualised drop since November 2009. |