The French economy grew slightly in the first quarter of 2023, exceeding analysts’ expectations and falling in line with the Bank of France’s forecast. Preliminary data from the INSEE statistics agency showed that the country’s second-largest economy increased by 0.2% in the first three months of the 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. This was significantly higher than economists had predicted, with a Reuters poll of 29 economists forecasting an average growth of just 0.1% in gross domestic product (GDP) for the first quarter, with estimates ranging from -0.1% to +0.1%.
Overall, this slight growth indicates positive momentum for the rest of the year as France continues to recover from the economic challenges posed by COVID-19 pandemic. Despite initial concerns about weak consumer spending and sluggish business investment, recent data suggests that households are starting to spend more money and businesses are becoming more optimistic about future prospects.