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France calls on ECB to fix 'broken' Europe, as German & French GDP lag

France calls on ECB to fix 'broken' Europe, as German & French GDP lag

The German and French economies both disappointed in the second quarter, casting doubts over the eurozone’s fragile economic recovery.

The German economy shrank 0.2% during the second quarter, while the French economy failed to record any growth over the same period. It is the second consecutive quarter the French economy has not recorded growth. The implications for the currency bloc are profound and suggest further signs that it is moving towards deflation.

The French stagnation means the government will miss its budget deficit this year and will halve its gross domestic product forecast for 2014. Fresh from the figures the country called on the European Central Bank to do more to tackle the risk of deflation and bring the euro to a more competitive level.

Sky news reported that French finance minister Michel Sapin told the daily Le Monde newspaper: 'Growth has broken down, in Europe and in France. With zero growth in the second quarter, thereby extending the stagnation we saw in the first, our country is slowing down and will not achieve the 1% growth observers were predicting three months ago.'

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