Despite a slight slowdown, economic activity continued to progress in France in the second quarter of 2024, with quarterly growth of 0.2%, after 0.3% in the first quarter. The mid-year growth carryover thus amounts to 0.9% for 2024.
In the third quarter of 2024, growth would be high, supported by the effect of the Olympic and Paralympic Games, before a setback in the fourth quarter. Over the whole of 2024, growth would thus amount to 1.1%, stable compared to the previous year. It would be mainly driven by foreign trade and public spending, while private domestic demand (excluding stocks) would slip. Inflation would fall to 2% on an annual average according to the consumer price index (CPI), after 4.9% in 2023. In 2025, growth would decrease slightly, to 1%. It would be supported in particular by the acceleration in household consumption enabled by disinflation, with inflation (CPI) forecast to decline, to 1.1% on average annually. The rebound in private investment would also stimulate activity, linked to the delayed effect of the drop in key interest rates and the structural needs linked to the double transition. On the other hand, foreign trade would no longer contribute to growth in 2025. Budgetary efforts would also weigh on growth, with a slight decline in public administration consumption expenditure in volume and a marked slowdown in their investment. The public deficit would reach 6.1% of GDP in 2024, then decrease to 5.5% of GDP in 2025.
