In the first quarter of 2025, France's Gross Domestic Product (GDP) grew by a modest 0.1%, according to initial estimates by the national statistics office. This slight rebound follows a 0.1% contraction in the last quarter of 2024, partly due to the temporary disruptions caused by the Paris Olympic Games.
Key drivers of growth:
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Inventory changes: These contributed +0.5 percentage points to GDP, making them the main growth driver for the quarter.
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Industrial production: Up by 0.4%, supported by strong performance in the agri-food sector (+1.6%) and transport equipment (+1.4%).
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Market services: Rebounded by 0.4%, particularly in business and household-related services.
Growth restraints:
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Household consumption: Flat at 0.0%. Spending on goods dropped by 0.6%, especially in transport equipment (-4.4%) and food (-0.8%), though service consumption rose by 0.5%.
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Business investment (GFCF): Fell by 0.2%, mainly due to declines in construction (-0.8%) and capital goods (-1.6%).
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Foreign trade: Weighed down growth by -0.4 percentage points. Exports declined by 0.7%, while imports rose slightly.
Outlook for 2025:
Annual growth forecasts have been revised downward. The government now expects GDP growth of 0.7% (initially 0.9%), while the Bank of France and the OFCE predict 0.7% and 0.5%, respectively. These revisions reflect cautious consumer behavior, weak private investment, and global economic uncertainty.
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