French Economic Growth to Slow in 2007

(Bloomberg) French economic growth will slow this year as higher borrowing costs stemming from the plunge in U.S. subprime mortgages curb real-estate spending, the French statistics office said, lowering its previous forecast. Growth in Europe's third-biggest economy will slow to 1.8 percent this year, compared with a June forecast of 2.1 percent and 2006 expansion of 2 percent, said the statistics office, known as Insee. This summer's financial turmoil has darkened the prospects for global growth,'' Pierre-Olivier Beffy, an Insee economist, said at an embargoed briefing yesterday in Paris.