Bank of France raises fourth-quarter GDP estimate to 0.5 percent

Reuters

PARIS (Reuters) - France's economy is set to gather steam toward the end of 2013 and will grow by 0.5 percent on the quarter in the final three months of the year, the Bank of France said on Friday in its second of three estimates.

The French central bank pointed to rising production in industry as it raised its quarterly growth view from the 0.4 percent of its first estimate. The Insee statistics office still sees growth at 0.4 percent in the fourth quarter.

The Bank of France based its fourth-quarter estimate on the results of its monthly business sentiment survey, which showed its index for the industrial sector rising by one point to 101.

That marked the first time the business sentiment index had risen above its long-term average of 100 since May, 2011, as chief executives reported a slight increase in orders for pharmaceutical products, chemicals, automobiles and food.

The Bank said managers expected activity to remain strong in coming weeks.

Sentiment in the services sector fell by one point to 92.

Respondents to the central banks' survey reported that staffing levels had risen slightly in the service sector, with prices expected to remain stable and activity seen firming modestly in December.

President Francois Hollande's government, struggling with weak poll ratings, estimates that the 2 trillion euro ($2.7 trillion) economy will grow at least 0.1 percent over 2013 after France emerged from recession at the start of the year.

Standard & Poor's cut France's sovereign credit rating last month by one notch to AA over doubts that Hollande's policies could restore growth over the medium term.

(Reporting By Nicholas Vinocur; Editing by Brian Love and Mark John)

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