French central bank warns of unusually uncertain economic outlook

France’s central bank expects the economy to return to modest growth in the fourth quarter, but says unusually high uncertainty surrounds that forecast amid political turmoil, recent violent riots and growing concern among business leaders about the country’s social and fiscal situation.

The warning follows an unexpected 0.1% contraction in the third quarter compared with the previous three months. France, the eurozone’s second-largest economy, has recorded no growth so far this year, according to the report.

The central bank said business activity increased last month and was expected to make further progress in November. But business leaders were increasingly worried about social, fiscal and political conditions, including France’s high public debt and budget deficit. The bank described the economic climate as “very fragile and uncertain”.

Last week, central bank president Emmanuel Moulin said recent weak economic figures meant the forecast for growth this year would probably need to be cut. It currently stands at 0.4%.