French Q2 GDP rises by 0.5% in second quarter

Economic activity in the euro area's second largest economy benefitted from a boost to exports in the three months to June, leading some economists to raise their full-year forecasts for growth.

The Eurozone's gross domestic product expanded at a 0.55% quarter-on-quarter clip in the second quarter of 2017, INSEE said, as expected by economists.

In comparison to a year-ago GDP was 1.4% ahead.

INSEE's first quarter GDP estimate was marked up from a preliminary reading of 0.48% on the quarter to 0.54%.

Household consumption, the largest component of aggregate demand, picked-up to a 0.3% clip after rising by just 0.1% over the prior three months.

In parallel, public outlays expanded by 0.4%, the same pace as in the first quarter.

Total investment slowed to a 0.5% pace, albeit after a sharp rise of 1.4% in the month before. Meanwhile, inventories shrank by 0.6% against the first quarter, almost completely erasing the increase seen over the previous three months.

However, that was made up for amply by a 3.1% jump in exports, which led to a 0.8 percentage point contribution to GDP from net trade.

Following Friday's release, economists at Barclay's revised their full-year 2017 French GDP growth forecast from 1.7% to 1.8%, which would mark a significant acceleration from the 1.1% pace seen in 2016.

"Today’s GDP release was positive in our view, showing broad-based growth. Latest surveys suggest that momentum should be broadly maintained in the second half of 2017."