The French government is sticking to its target of 2.5 per cent growth in 2005, despite the high oil price and the level of the euro, the French finance and budget ministers said today.
"We have a forecast of 2.5 per cent growth in 2005 which is realistic," Finance minister Mr Herve Gaymard told LCI television in an interview. Budget minister Mr Jean-Francois Cope, who is also the government's spokesman, said the 2005 target was "reasonable".
The French economy, the euro zone's second largest, grew by 0.1 per cent in the third quarter, after a rise of 0.6 per cent in the second quarter and 0.7 per cent in the first quarter.
The Organisation for Economic Cooperation and Development said last week it expected the French recovery to gather steam in 2005, but downgraded its forecast for French growth next year to 2.0 per cent from 2.6 per cent previously.
Mr Cope made clear France remained vigilant about the high price of oil and the weak dollar, which has sapped foreign demand for European goods by making them more expensive in dollar terms.
Mr Gaymard said the slide in the dollar against the euro "should not continue" and was an issue for US and Asian monetary authorities, as well as European ones.
"The euro has increased in value . . . by almost 60 per cent compared to the dollar, since we were at about 80 euro centimes and we are at 1.34 or so at the moment," Mr Gaymard told LCI.
"This slide should not continue." He said the issue would be discussed with the European Central Bank and all of the euro zone finance ministers who meet on Monday before a gathering of European Union finance ministers on Tuesday.
"It is obvious that the solution, as you well know, is not only in Europe. It is also in the attitude of the American monetary authories and also in that of the Asian monetary authorities," he said.