While the government revised the growth forecast for 2024 by 0.4 points last month, from 1.4% to 1%, the Banque de France in turn corrected its estimate. In its “intermediate projections” published this Tuesday evening, the institution expects GDP growth of only 0.8% this year, compared to 0.9% previously. The correction is indeed very slight and can be explained by “less growth gains at the end of the fourth quarter of 2023”. As for the difference between Bercy’s forecast (1%) and the news from the Banque de France (0.8%), it falls within “the margin of uncertainty”, comments François Villeroy de Galhau, the governor of the Bank from France, in an exclusive interview with Le Figaro.
Next year, growth will accelerate, to 1.5%, then to 1.7% in 2026, predicts the Bank, “under the effect of more favorable assumptions on energy prices and financial conditions” . Interest rates should indeed begin to fall in the spring as inflation slows. The Banque de France confirms in its forecasts the decline in price increases. The consumer price index, after an increase of 5.7% over the whole of last year, should settle at 2.5% this year before falling to 1.7% in 2025, below of the target of the European Central Bank (ECB). Wages will not be a driver of inflation since economists at the Banque de France predict a “lesser increase in wages in the short term”. This slowdown will help disinflation but could slow down the recovery in consumption.
On the employment front, the Bank expects a slight increase in the unemployment rate, from 7.5% in 2023 to 7.8% “from the end of 2024 to the end of 2025”.