French economy to contract in Q4 2012: INSEE

France National Institute of Statistics and Economic Studies (INSEE) says the French economy is set to contract by 0.2 % percent in the fourth quarter of 2012 as the eurozone continues to grapple with economic woes.

“Activity should thus fall in Q4 2012 (-0.2%), notably because manufacturing production is set to fall back …,” INSEE said in its December forecasting report on Friday.

INSEE data also revealed that the country’s jobless rate is expected to jump above 10 percent during the period.

Since President Francois Hollande took office in May 2012, a further 230,000 people have registered as jobless.

Reports say France is heading for a recession by the end of 2012.

Europe plunged into financial crisis in early 2008. Insolvency now threatens heavily debt-ridden countries such as Greece, Spain, Portugal, Italy, and Ireland.

The worsening debt crisis has forced the EU governments to adopt harsh austerity measures and tough economic reforms, which have triggered incidents of social unrest and massive protests in many European countries.