France economy set to hit recession in Q3 of 2012

Workers of French carmaker PSA Peugeot Citroen at the Le Janay factory demonstrate in Chartres-de-Bretagne, outside Rennes, western France, on July 13, 2012, the day after the group announced it would slash 8000 jobs in France.

The Bank of France has predicted that the European state is set to head toward recession in the third quarter of the current year as the eurozone continues to grapple with economic woes. 

(PressTV) The bank warned on Wednesday that Paris is likely to enter recession in the third quarter of the year as its economy is expected to contract by 0.1 percent for the second quarter in a row.

“The outlook for the coming months suggests a slight slowdown in economic activity … GDP (gross domestic product) is expected to decline by 0.1 percent in the third quarter,” the Bank of France said in its monthly survey.

The development comes while on July 25, France’s Labor Ministry said the number of jobseekers in the country hit its highest level since 1999 as the figure rose for the 14th consecutive month in June.

The new jobless rate marked an increase of 0.8 percent over one month and 7.8 percent over one year.

Various eurozone member states have been struggling with deep economic stagnancy since the bloc’s financial crisis began roughly five years ago.

Also on Tuesday Italy’s official government statistics agency, ISTAT, said that the country’s economy shrank for the fourth quarter in a row, contracting 0.7 percent in three months through June, underlining a deepening recession in the country.

The worsening debt crisis has forced EU governments to adopt harsh austerity measures and tough economic reforms, which have triggered incidents of social unrest and massive protests in many European countries including Portugal, Spain, Greece and Italy.

MR/PKH

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