The government’s inflation forecasts are too optimistic, the High Council for Public Finances said on Wednesday. In an opinion on the macroeconomic forecasts associated with the 2023-2027 stability program unveiled last week and transmitted to Brussels, the institution judges that “the decline expected by the Government seems rapid”: the inflation forecasts, established at 4, 9% this year and 2.6% next year, “seem a little underestimated, as has been the case regularly over the past two years,” she adds.
The labels of food products should continue to flare up in the coming months, argues the High Council in its opinion. In addition, “the prices of services will remain supported by the strong increase in wages, linked to recruitment difficulties and the compensation for high inflation”. The government’s forecasts are also lower than those of experts such as the Banque de France or the OFCE.
In addition to price trends, the High Council is also cautious about other government forecasts. Growth forecasts “are not out of reach, but look optimistic”. Also, the ambitious debt and deficit reduction targets are based on “an unchanged macroeconomic scenario, including a favorable growth assumption”, as well as on “several years of expenditure control efforts on a greater scale to those which have been implemented in the past, while their timetable and their concrete modalities still remain unclear”. To be effective, the improvement of the public accounts will require the partial elimination of certain “decreases in compulsory levies”, or to compensate for them by “increases in other levies or reductions in tax expenditure”, warn the experts. Charge the government to make them lie.
