French output surges 1.3% in July

French industrial output surged 1.3 per cent in July after an unexpectedly sharp fall the previous month, data showed today.

The recovery, led by a strong recovery in car production and rises in capital and intermediate goods, was all the more marked as the June fall was revised to 0.6 per cent from 0.5 per cent.

The July figure was well ahead of a consensus forecast of a 0.4 per cent increase.

The data provided some encouragement for the conservative government of President Nicolas Sarkozy, whose 2-2.5 per cent growth forecast for 2007 has left many economists sceptical.

The Organisation for Economic Cooperation and Development has cut its growth forecast for France this year to 1.8 per cent from 2.2 per cent.