It has come as somewhat of a surprise to many how quickly the French has grown at the start of this year. But many analysts are concerned by the continued fall in investment.
This year has seen the French economy grown at its fastest pace compared to the previous 2 years. GDP has risen twice as fast in the UK at the start of the year.
France's GDP grew by 0.6% during the first quarter. This is 50% faster than the economists had expected. At this pace the economy has increased size twice as fast as that of the UK's during the same period.
Claus Vistesen from Pantheon Macroeconomics stated that the GDP report is characterised by:
"Strong consumer spending amid wild volatility in net trade and inventories."
He also added that "a 0.8% quarterly increase in consumer spending following a 0.1% rise in the 4th quarter was the main driver of the above consensus rise in French GDP."
Whilst French GDP figures have received a boost through great consumption. It should also be noted that there has been a decline in investment for the 7th month running. This is according to the French statistics agency INSEE.
Maxime Sbaihi, economist with Bloomberg said: "That France would need to keep repeating its strong 1st quarter performance. To reverse the investment decline and finally start bringing down a record-high unemployment rate."
Furthermore Clause Vistesen stated that: "Overall, this is a strong GDP report, but it is also distorted by a number of one-off factors. The increase in consumer spending is encouraging, but the underlying trend in private investment growth remains poor."
The figures from France came as the same numbers for Germany showed a slowdown in Europe's largest economy. The German GDP rose by only 0.3% during the 1st quarter, following growth of 0.7% during the final 3 months of last year.
Destatis a statistics agency that compiled these figures, said: "the German economy continued to grow at a slightly slower pace."
Most analysts were expecting a weaker German GDP figure, but hadn't appreciated the magnitude of the approaching slowdown. Economists had in fact pencilled in for growth of 0.5% during this period.
As for the wider eurozone economy it is expected that it will have grown by 0.4% during the first 3 months of this year. These figures will be published later today.