Rising inventories and higher household spending were the main driving forces behind euro zone economic growth in the third quarter. But as David Pollard reports, France is still struggling, with the Bank of France revising down growth.
Euro zone growth: not exactly stuck in the sidings, but nowhere near top-speed either. Q3 GDP slowed to 0.3 per cent on the quarter, from 0.4. And the Bank of France is revising its Q4 forecast down to the same rate. Consumers on board this special Christmas train in Bavaria - they are spending, and more than before. But foreign trade's down. And on the political front, the threat to the incumbents in French and Spanish elections this month adds uncertainty. Jeremy Batstone-Carr is from Charles Stanley. (SOUNDBITE) (English) CHARLES STANLEY DIRECTOR OF PRIVATE CLIENT RESEARCH, JEREMY BATSTONE-CARR, SAYING: "This is raising a major issue for both country and supra-national governments around the region and I think that euro zone is under another period of incipient, intense pressure." British consumers are still spending too, but by not quite as much. Their shopping down 0.4 per cent on a like-for-like basis - disappointing hopes of a Black Friday boost to UK high streets. There were big gains online: spending on the web up nearly 12%. But UK manufacturing is in an unexpected pre-Christmas slump - output fell 0.4 per cent in October. Hopes of rebalancing the economy away from its dominant services appear to be receding. (SOUNDBITE) (English) CHARLES STANLEY DIRECTOR OF PRIVATE CLIENT RESEARCH, JEREMY BATSTONE-CARR, SAYING: "The basic problem is that the pound is strong and our markets, our international markets, are extremely weak. The UK has become, once again, a two-speed economy." The euro zone can, says Carr, bet on more central bank stimulus. For now, a full head of steam only seen on a railway track in Munich.