The French economy expanded by 2.3% last year, one of the best performances in the 12-nation euro zone, but Paris saw its three-year trade surplus turn into a deficit owing to the strong euro and surging imports.
Reporting the yearly growth figure, the national statistics institute Insee said gross domestic product grew by 0.7-0.8% in the fourth quarter. The figures exceeded expectations of 0.6% in the last three months and 2.1% for the year.
Analysts now foresee GDP momentum of 1.8% in 2005, well below the government forecast of 2.5%.
But the good growth news was tempered by a report from customs authorities that France last year had a trade deficit of €7.765 billion, its worst performance since 1991.
The shortfall in the month of December alone came to €1.892 billion. The yearly deficit was attributed to a stronger euro, higher oil and steel prices and the weak presence of French companies in dynamic regions such as Asia.
* The Paris CAC 40 stock index today topped the symbolic 4,000 point level, above which it has not closed for two and a half years. The index rose to as high as 4,003 but later slipped back to 3,995.23 points in early afternoon trading.
Dealers said French stocks were benefitting from an improving economic outlook that should underpin solid growth in corporate
profits.
