The French government on Thursday slashed its growth forecast for 2009 and said its budget defict would reach 3.1 per cent of gross domestic product, breaching the European Union’s normal deficit ceiling.

Christine Lagarde, finance minister, told parliament the French economy would expand by 0.2-0.5 per cent next year rather than the 1-1.5 per cent growth she had forecast only six weeks ago in the 2009 draft budget.