The French financial system does higher than anticipated within the first quarter | EUROtoday

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The French financial system carried out relatively higher than anticipated firstly of the yr: whereas the National Institute of Statistics and Economic Studies (Insee) anticipated a sluggish first quarter, the gross home product (GDP) elevated by 0.2% over this era, in accordance with knowledge revealed Tuesday April 30. This digit “reflects the solidity of the economy”instantly reacted the Minister of the Economy, Bruno Le Maire, who expects progress of 1% in 2024.

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An goal which isn’t unrealistic given the info revealed on Tuesday: the expansion achievement – ​​the determine which might be reached on the finish of the yr if the subsequent three quarters have been sluggish – already stands at 0, 5%, specifies Nicolas Carnot, director of financial research and syntheses at INSEE. The Banque de France, which forecasts barely decrease progress of 0.8% for the yr, judges that this determine of 0.2% is ” consistent ” along with his prediction.

The predominant lever of exercise, because it represents half of GDP, family consumption is displaying indicators of trembling: it elevated by 0.4% between January and March, a change in development after two years of sluggishness. The slowdown in costs is undoubtedly no stranger to this: in April, inflation rose to 2.2%, in comparison with 5.9% in April 2023, INSEE additionally signifies. Food costs, specifically, have seen a marked slowdown: the double-digit will increase of 2023 are actually behind us – over one yr, the rise is just one.2%. Fresh merchandise, specifically, even noticed a drop of 0.7%. It is now the costs of power (+ 3.8%) and companies (+ 3%) which have elevated probably the most over twelve months.

Opportunity purchases

As a consequence, meals consumption elevated by 0.5% within the first quarter, after having plunged by 4.8% in 2023. Purchases of manufactured items stay extra cheap (+ 0.1%) and above all, giant purchases equivalent to that these of vehicles are down 3.5%. A drop undoubtedly linked to end-of-year promotions and the tip of ecological bonuses, which had prompted alternative purchases on the finish of 2023. Consumption of companies (+ 0.7%) is trending effectively, significantly lodging and catering, up 1.5% over the primary three months of the yr, and transport companies up 2.1%.

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In the second quarter, vital value drops on sure manufactured items may present a further increase to consumption, particularly as the amount of French financial savings stays significantly excessive. “This is where we have the most potential rebound capacity”, recollects Mathieu Plane, economist on the French Observatory of Economic Conditions. Especially since buying energy, on the identical time, ought to regain some dynamism, due to the revaluation of pensions and social advantages which came about firstly of the yr, and to wage will increase which ought to exceed inflation throughout 2024 .

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