Bank of France Estimates French GDP Contracted 0.1% in Q3

The Bank of France said Monday that the French economy likely contracted by 0.1 percent in the third quarter of this year in its final estimation.

If the estimate is confirmed by France's official statistical agency INSEE, it would be the first quarterly contraction since France exited recession in the spring of 2009.

INSEE's chief forecaster said last week that the agency believes France will continue to escape recession, but stagnate with zero growth in the third and fourth quarters, as opposed to its previous forecasts in June of 0.1 percent and 0.2 percent growth respectively.

That would make for five consecutive quarters of no growth, an unprecedented stagnation for the French economy since World War II.

INSEE also last week halved its 2012 growth forecast to 0.2 percent.

That forecast puts INSEE just below the government's forecast of 0.3 percent growth to bring France's public deficit to 4.5 percent of GDP as pledged to the European Union.