French carmaker Renault is predicting a 7% fall in sales in Europe this year after it reported a 39% drop in first half profits.

Net profits in the six months to June fell 39% to 786m euros, while revenue fell to 20.9bn euros, down 0.8% when compared with the same period last year.

Low European demand was partly offset by international growth, Renault said.

Renault forecast global car demand would grow by 5%, but lowered its outlook for European demand by 7%.