French output grew slightly in the third quarter — providing some support to the euro area as it grapples with higher interest rates and prolonged manufacturing weakness.
Gross domestic product in the bloc’s second-largest economy rose 0.1% in the three months through September, data Tuesday showed. That’s down from a revised 0.6% in the previous quarter and is in line with expectations.
The numbers come after Germany reported a small drop in GDP that may mark the start of a recession. For the continent as a whole, the picture is mixed. While Spain and Belgium recorded expansions, Austria and Ireland shrank. Figures for the 20-nation euro zone, expected to show stagnation, are due later Tuesday.
Europe faces multiple headwinds. Inflation — while abating — continues to pummel households, and the rate hikes enacted to rein it in are hurting investment. Softer Chinese demand, meanwhile, is curbing industry and governments are starting to withdraw energy-support measures to trim debt levels.
France showed resilience in the earlier part of this year, thanks in part to strong exports. But in the third quarter, foreign sales fell significantly, while consumer spending grew.
Some of its largest companies are starting to struggle. Revenue growth at retailer Carrefour has slowed as consumers continue trading down to cheaper brands — despite food inflation easing over the summer.
--With assistance from Angelina Rascouet, Ainhoa Goyeneche and Joel Rinneby.
