By Neal Wallace
Both the German and French economies grew during the third quarter of 2011, according to official data.
The BBC reports that France's economy grew by 0.4 per cent, while Germany's gross domestic product (GDP) saw a rise of 0.5 per cent during the same period. However, observers expect the German economy to contract during the coming months.
France's National Institute for Statistics and Economic studies cited household spending as the reason behind the growth, while Germany said that domestic demand caused the statistical rise.
Germany's financial advisers last week said that the expected growth for next year is 0.9 per cent, just short of the government's forecast of one per cent. This represents a marked decline when compared with growth expectations of three per cent for this year.
The gap between implied interest rates in the two countries widened by 1.726 percentage points, with Germany's 10-year-bonds falling to 1.175 per cent and France's rising to 3.5 per cent.
European markets saw a steady end to last week after much turmoil in the Eurozone.