PARIS (MktNews) - The Bank of France forecast Wednesday French second quarter GDP growth of 0.6%, based on its monthly industry survey, and confirmed in first quarter projection of +0.7%.
Even if growth were flat in the second half of this year, the average GDP gain would be 2.4%, it said.
Demand remained strong in February, but eroded slightly due to weaker foreign demand, resulting in a decline in back orders, the central bank said.
Domestic orders continued to rise and orders from the eurozone remained "solid." But foreign orders for semi-finished goods declined markedly, especially from the United States and Asia.
Industry growth in February was also slower after a strong recovery in January. Capacity utilization eased but remained very close to the record high in January.
"Industrial activity should continue to expand in all sectors in the months ahead," it said.
The rise in finished goods prices slowed slightly in February, while raw material prices stabilized.
After a sharp rise in January, real retail sales were less buoyant in February, giving a two-month increase of 5.8% over November-December, adjusted for seasonal variations and the number of working. Real January-February sales were up 2.8% over the previous-year period.
There was no relief in sector hiring difficulties, the survey showed. Full-time employment increased in industry and services, absorbing temporary positions, while employment in construction and trade was stable.
The Bank of France's monthly survey covers some 6,000 industrial, construction and wholesale companies, 4,000 retail outlets and 2,000 service firms.