According to INSEE’s quarterly GDP report, the French economy grew slightly in the first quarter, which was a bit above analysts’ expectations. The euro zone’s second-biggest economy saw a 0.2% increase in the first three months of the current year, following a 0.1% growth in the fourth quarter of 2023.
The reported growth for the quarter aligned with the Bank of France’s expectation announced in early April, indicating a positive trend in the French economy. The acceleration in household spending suggests a boost in consumer confidence and economic activity, which is good news for future economic performance in France.
In fact, a Reuters poll of 29 economists had forecasted an average growth of 0.1% in gross domestic product (GDP) for the first quarter, with estimates ranging from 0.0% to +0.2%. Household spending growth for the quarter accelerated to 0.4%, compared to 0.2% in the previous quarter, showing that consumers are feeling more confident about their financial situation and are willing to spend more money on goods and services.
This news comes as a relief for many experts who had predicted that France would face another recession due to its high debt levels and slow economic growth rates. However, this slight increase in GDP growth suggests that France is moving towards recovery and that its economy is slowly improving overall.
Overall, this report indicates that while there are still challenges ahead for France’s economy, there is hope that it will continue on this positive trajectory moving forward.
