French Economy Expected to Grow in Q1
Positive Outlook for French Economy
The French central bank has predicted a slight growth for the country’s economy in the first quarter, marking the end of a six-month period of stagnation. According to the bank’s monthly business survey, the economy is expected to expand by 0.1% to 0.2% in the coming months.
Sectoral Analysis
The Bank of France reported that declines in the construction and energy sectors were offset by a rise in value added in industry, with services remaining stable. This balanced growth across sectors indicates a promising outlook for the economy.
Impact of Farmer Protests
The survey also highlighted the negative impact of large-scale farmer protests on the transport and automotive sectors, as well as restaurants. Despite this, the central bank remains optimistic about the overall impact on growth for the quarter and the year.
Industry Confidence
Business executives in the industrial sector expressed confidence in their output levels, particularly in the food, auto, and aero sectors. However, certain manufacturing sectors such as rubber, plastics, and metal are expected to face further contraction.
Revised Growth Rate
The Bank of France revised its growth rate for the fourth quarter of 2023, indicating that the economy had stagnated at 0.0%, as opposed to the previously estimated 0.2% growth. Despite this, the bank anticipates full-year growth at close to 0.9% for the current year.
Amid a general slowdown, the situations differ from sector to sector. Overall, services resist more than manufacturing,” said central bank chief Francois Villeroy de Galhau.
