Oil drops as France announces automotive sector decline
Eurozone fears have led to Brent Crude Oil futures slumping in trading today (June 8th), after it was revealed French car making suffered a disappointing May.
The Bank of France posted that the automotive sector declined last month, pulling the commodity down on the markets, with the financial institution's Survey on Industry and Services for May revealing that industrial activity slowed over the 31-day period.
In addition to vehicle production, metalworking sectors also posted results that were below economists' expectations.
Furthermore, activity in the services industry "marked an overall decline, especially in the temporary work, transport and hotel-catering sectors".
The Bank of France has stated that it expects the French economy to contract by 0.1 per cent over the course of the second quarter of 2012, having originally anticipated there would be zero expansion less than one month ago.
By contrast, the German central bank has increased its predictions for growth in the eurozone's largest economy to one per cent from 0.6 per cent.
It is German expansion that has kept the 17-nation bloc out of recession in 2012 so far.
However, the Bundesbank cut its 2013 forecast for growth from 1.8 per cent to 1.6 per cent, with latest figures from the country showing that its exports fell by 1.7 per cent in April compared with the previous month.
This decline followed three months in a row of gains.
However, exports from Germany have increased 3.4 per cent compared with last year, with a 10.3 per cent rise in exports to countries outside the European Union contributing to this.
Its imports, however, dropped 4.8 per cent compared with the month before.
At 11:40 BST, Brent Crude Oil Futures were down 1.7 per cent to a value of just $98.2 per barrel - the commodity's lowest price in 12 months.
West Texas Intermediate Crude Oil Futures also plunged 1.7 per cent to $82.7 per barrel.
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