France Perking Up?

Reuters Business Report - He's nicknamed Mr Normal. Or Grandpa.

Take another look, you'll see that, if the allegations are true, Francois Hollande has a secret side.

The French president deplores a story linking him to French film actress, Julie Gayet, as an invasion of privacy.But on the eve of publication, his poll ratings went up one point.

Though that's probably coincidence, and his ratings are in a slump anyway.

And the French public wave the story aside with a shrug.

PASSER-BY EMMANUELLE,

"I think it's an uninteresting issue and I think there are many other more important issues in France than this one."

Top of the important issues list is, of course, the economy.

Also on the eve of publication, the head of the public audit office warned that France's national debt was reaching, in his words, ''a danger zone''.

Despite the overall gain in his ratings, the same poll shows core voters trust him less than before.

Ishaq Siddiqi of ETX Capital says France is, if not dangerous, then certainly a no-go zone.

ISHAQ SIDDIQI, MARKET STRATEGIST, ETX CAPITAL,

''Very, very bearish on the French economy, and that's due mostly to the fact that the government is extremely behind the curve when it comes to implementing the right sort of reforms.''

As the story went to press, Hollande was greeting Japanese dignitaries.

Despite the gossip, there might be a few extra smiles thanks to the latest data.

The Bank of France says it sees a healthy rebound in growth in the fourth quarter.

Latest official figures point to a bigger-than-expected November surge in industrial production.

Investor flows into Europe hint at some interesting developments, according to Ian Stannard of Morgan Stanley.

MORGAN STANLEY, HEAD OF EUROPEAN FX STRATEGY, IAN STANNARD,

''When we look at the country breakdown, we actually see that France was one of the favoured destinations for foreign investors. So looking at that growth picture in France is going to be very important for trying to gauge the sustainability of some of those flows.''

France is traditionally tolerant of romantic scandals among its leaders.

It might be less indulgent towards Hollande's Socialist Party when it faces municipal elections in March and European elections two months after that, unless the growth story is confirmed