The French economy grew slightly in the first quarter, slightly exceeding analysts’ expectations. Preliminary data from the INSEE statistics agency showed that 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.
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%. Despite these predictions, the growth in the quarter was actually higher than expected and fell only slightly below what was forecasted by the Bank of France earlier this year.
Overall, household spending played a significant role in driving economic growth in France during Q1, as it accelerated to a rate above expectations. The data indicates that positive momentum is continuing for France as it continues to recover from economic challenges caused by COVID-19 pandemic, with GDP still growing despite predictions suggesting otherwise earlier on in the year