The French economy contracted unexpectedly in the fourth quarter on weak spending and investment, first estimate from the statistical office Insee showed Friday.

Gross domestic product fell 0.1 percent on quarter, reversing a 0.3 percent rise in the third quarter. This was the first decline since the second quarter of 2016. Economists had forecast a marginal growth of 0.2 percent.

The expenditure-side breakdown of GDP showed that household consumption growth halved to 0.2 percent from 0.4 percent. At the same time, the increase in gross fixed capital formation decelerated notably to 0.3 percent from 1.3 percent.

Overall, final domestic demand excluding inventory changes slowed down compared with the previous quarter. It contributed +0.3 points to GDP growth, after +0.7 points a quarter ago.

Imports fell 0.2 percent, in contrast to an increase of 0.6 percent in the third quarter. Exports were down 0.2 percent after easing 0.3 percent. Consequently, the contribution of foreign trade balance to GDP growth was zero, after a negative contribution.

Changes in inventories contributed negatively to GDP growth by-0.4 points versus -0.1 points in the preceding period.

In the whole year of 2019, economic growth slowed to 1.2 percent from 1.7 percent in 2018.

Early this month, the International Monetary Fund retained its growth outlook for France, at 1.3 percent for both 2020 and 2021.

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