Euro zone growth beats forecasts as France outperforms

The euro zone economy grew a touch more quickly than expected in the third quarter, lifted by buoyant growth in France and Spain that more than offset faltering exports and persistent struggles in Germany's oversized industrial sector.

The economy of the 20 nations sharing the euro expanded by 0.2% in July to September, Eurostat data showed, beating expectations for 0.1% increase in a Reuters poll and confirming the bloc's resilience despite stagnation in Germany and Italy.

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While trade tensions, lingering uncertainty and Chinese dumping of surplus goods could still weigh on growth in the months ahead, economists remain relatively upbeat about the outlook and ECB projections suggest the third quarter may have been the worst for some time.

Growth could pick up as past interest rate cuts work their way through the economy, households sit on ample savings, Germany boosts spending, uncertainty over tariffs eases and inventories continue to run low.

Business activity, as measured by a key Purchasing Managers' Index (PMI) survey, is already showing a pick-up, while sentiment in Germany, the bloc's biggest economy, is improving and business are becoming more optimistic, partly due to lower tariff uncertainty.

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