The Bank of France now forecasts for the year 2023 a growth of the French economy of "at least" 0.6%, while inflation slows "really", said Friday its governor, François Villeroy de Galhau. "Growth in 2023 (...) will be at least equal to what we forecast last March, that is to say at least 0.6%," Villeroy de Galhau told Radio Classique, adding that the Bank of France would update its projections until 20 on 2025 June.
In the second quarter, the French economy should continue to resist modestly, with an increase of 0.1% in gross domestic product (GDP) compared to the previous three months, according to the monthly business survey published by the institution on Thursday. On the price front, it reported improvement, although inflation remains high. "The good news is that there is a change in trend on price increases on the part of companies," explained François Villeroy de Galhau. In industry, 10% of business leaders increased their prices in May against 50% a year earlier, he detailed, and "we see the same trend in services". "This is what supports our analysis: that we are passing the peak of inflation in France and in the euro area," he continued. "There really is a slowdown in inflation."
By carrying out a muscular monetary tightening since the summer of 2022 to curb the rise in prices, the European Central Bank (ECB) aims to return to the objective of 2% by 2025. According to a first estimate by the National Institute of Statistics (INSEE), inflation in May benefited from a serious brake in energy that was at the origin of the inflationary shock but has since been supplanted by food. Prices continued to rise year-on-year, by 5.1%, but less strongly than in previous months (5.9% in April and 6% at the beginning of the year).
