French growth accelerated more than expected at the start of the year with the strongest increase in consumer spending since 2004 and a pick-up in business investment. The economy grew 0.5 percent in the first quarter, beating even the most optimistic forecast in a Reuters poll, as consumers splurged on clothes, cars and housing equipment, the INSEE national statistics agency said in a preliminary estimate of gross domestic product (GDP) on Friday.
Consumer spending was up 1.2 percent over the three months, with higher spending on heating after a mild end to 2015, also offering a boost and offsetting the impact of a global slowdown that hurt exports. If consumers led the way in the quarter, however, economists particularly took heart in a 1.6 percent rise in business investment, the strongest increase in five years. Investment by companies in the manufacturing sector surged by 3.3 percent, the highest since the spring of 2006.