French industrial output unexpectedly shrank in June, contrasting with recent more positive data and indicating that any recovery in the euro zone's second-largest economy may be fragile, reports Reuters.
Other economic data and business confidence surveys have suggested that France may be pulling out of recession, but that muted domestic demand is still holding back the economy.
Industrial output fell 1.4 percent in June from the previous month after a revised 0.3 percent drop in May, data from the INSEE statistics agency showed on Friday, missing expectations in a Reuters poll for a 0.1 percent rise.
Highlighting a divergence between the euro zone's two largest economies, German industrial output rose by 2.4 percent in June, its fastest pace in nearly two years, data showed on Wednesday.
The contraction in French industrial output was driven by a decrease in the production of food and agricultural goods as well as in energy and mining.
Industrial output was nevertheless up 1.4 percent quarter on quarter.
"We still believe that the outlook for the industrial sector has brightened lately, on the back of a moderately more positive external outlook - particularly in Germany - and rising business confidence at home," Diego Iscaro, economist at IHS Global Insight, wrote in a note.
"Nevertheless, still difficult domestic conditions mean that any improvement is likely to be gradual and prone to relapses."
Higher readings in business and consumer confidence and a rise in industrial output in April have prompted French President Francois Hollande to drum up optimism over the health of the economy in recent weeks, even saying "recovery is here".
However, businesses and economists are sceptical, pointing out that data is still too fragile to help the Socialist government fulfil its pledge to reverse by year-end a rise in unemployment, currently stuck above 10 percent.
Read more of this report from Reuters.