The French economy resists in the first quarter, according to the Banque de France

The French economy should continue to prove resilient in the first quarter, with activity growth expected at 0.1% in a context still marked by inflationary tensions, the Banque de France said on Wednesday, which intends to raise its forecast by annual growth.

“Growth in the first quarter is rather slightly better than what was expected at the end of last year,” said Olivier Garnier, director general of statistics, studies and international affairs at the Banque de France, citing in particular lower gas and electricity prices than expected.

Moreover, “companies have adapted well to the energy situation, they have managed to maintain their activity, (…) despite the increase in the cost of energy”, he added during a point press.

A reassuring picture

Faced with this more reassuring picture, the Banque de France intends to slightly raise its growth forecast, currently 0.3% for 2023, when presenting its annual projections on March 20.

The Governor of the Banque de France, François Villeroy de Galhau, had already expressed increased optimism for the French economy, during a hearing on March 1 at the National Assembly. Despite the sharp slowdown expected this year, after a GDP up 2.6% in 2022, he had ruled out, “barring a major global event”, the risk of a recession, which was still perceived as possible a few months ago. .

While inflation has reached levels not seen since the 1980s, the evolution of prices gives rise to less celebration. “The signals are still mixed,” noted Garnier. According to INSEE, inflation rebounded to 6.2% year on year in February, but food products experienced a double-digit surge (14.5%), supplanting energy as the main driver of the increase. prices and directly affecting households’ wallets.

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