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The French economy is in recession, national statistics agency INSEE confirmed on Wednesday, with output down 0.2 per cent in the first quarter of the year after an equivalent drop in the last quarter of 2012.
A recession is defined as two consecutive quarters of negative growth.
The latest data suggests that President Francois Hollande’s forecast of 0.1 per cent GDP growth in 2013 may be optimistic.
INSEE expects the Eurozone’s second-largest economy to instead shrink by 0.1 per cent in 2013, after zero growth in 2012.
The agency did, however, signal a positive trend in purchasing power.
Households’ disposable income rose 1.3 per cent in the first quarter, after a sharp decline in 2012. INSEE linked the development to a fall in income taxes and wealth taxes after a tax surge in 2012.
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