According to preliminary data from the INSEE statistics agency, the French economy grew slightly in the first quarter, beating analysts’ expectations. The euro zone’s second-largest economy increased by 0.2% in the first three months of the current year, following a 0.1% growth in the fourth quarter of 2023, as reported in the quarterly GDP report by INSEE.
Household spending growth accelerated to 0.4% in the first quarter compared to 0.2% in the fourth quarter of 2023. 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%. The growth in the quarter was in line with the Bank of France’s expectations announced in early April.
Overall, household spending played a significant role in driving slight growth in the French economy during the first quarter. Despite falling short of some analysts’ expectations, it still exceeded others and is a positive sign for economic recovery efforts underway due to COVID-19 challenges.
The data suggests that France has shown positive momentum for its rest of year performance after experiencing economic difficulties caused by COVID-19 pandemic.
The Bank of France had predicted this slight growth and was pleased with its performance during this period while analysts were divided about how much it would grow but all agree that it is good news for a better future economic scenario for France as it moves towards recovery from pandemic impact on its economy