PARIS, April 30 ― The French economy grew more than expected in the first quarter and inflation slowed this month, official data showed today, delivering good news to a government burdened with a huge debt pile.
The eurozone's second biggest economy expanded by 0.2 per cent between January and March compared to the previous quarter, according to the INSEE statistics institute, which had previously forecast zero growth.
It accelerated from 0.1 per cent growth in the final three months of 2023.
“To all those who want us to believe that our economy is at a standstill: facts are stubborn. French growth is progressing,” said Economy Minister Bruno Le Maire.
“This is a new sign showing the solidity of our economy,” he said, adding that the “government's strategy is paying off.”
Growth was driven by the country's economic engine, household spending, which rose 0.4 per cent in the first quarter, accelerating from 0.2 per cent in the previous quarter as inflation eases.
“It's clearly the engine of the rebound,” said Allianz Trade economist Maxime Darmet.
Inflation slowed to 2.2 per cent in April after consumer prices grew 2.3 per cent in March, INSEE data showed.
The positive growth and inflation figures come as President Emmanuel Macron's administration is under pressure to rein in the country's mounting debt.
France's budget deficit has overshot government estimates, undermining Macron's pledge to bring national finances back on track within the next four years.
Ratings agencies have cast doubt on the government's debt reduction target.
The public deficit widened to 5.5 per cent of gross domestic product in 2023, but the government is sticking to its target of reducing it to three per cent by 2027.
“Other countries in Europe have done it. I don't see why France would not be capable of doing it,” Le Maire told lawmakers yesterday.
French debt has grown to 110.6 per cent of GDP ― the third biggest ratio in the European Union after Greece and Italy. — AFP
