France’s economy unexpectedly shrank in the first quarter as consumers struggled to cope with rising inflation, official data showed on Tuesday, putting pressure on President Emmanuel Macron heading into this month’s legislative elections.
Statistics agency INSEE said the euro zone’s second-largest economy contracted 0.2% in the three months to March compared with the previous quarter.
Previously, the agency had estimated that the Gross Domestic Product had been stable during this period.
Data showed that consumer spending was weaker than previously estimated, falling 1.5% instead of the previous reading of 1.3%, as households avoided spending on new cars and hotels.
While an outbreak of the Omicron variant of Covid-19 weighed on activity earlier in the year, rising consumer inflation — which INSEE said hit a record 5.8% in May — affected household spending.
Source: CNN Brasil
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