GDP in very low increase of 0.1 % in the first quarter – Liberation

French economic activity increased by 0.1 % in the first quarter, the INSEE announced this Wednesday, April 29, April 29. This moderate increase in the gross domestic product (GDP) between January and March corresponds to the forecast of the National Institute of French Statistics, and succeeds the contraction of 0.1 % which had been observed in the fourth quarter of 2024 due to the counterposer of the Paris Olympic Games.

« The good news behind this figure is that despite the absence of a budget – since we waited at the end of February to have a budget and it has weighed up a lot on growth – growth is positive »reacted this Wednesday the Minister of the Economy, Eric Lombard, on the antenna of Sud Radio: “What is important at the start of the year is called growth in growth. That is to say that if nothing more happened, growth throughout 2025 would be 0.4 %. This figure is important, that means that we are online to reach Our 0.7 % target. « 

This publication of French growth precedes that of Germany, Italy and the euro zone, while Spain saw its GDP increase by 0.6 % in the first quarter. It intervenes in a political context still unstable in France, the minority government of François Bayrou being regularly threatened with censorship.

In the first quarter, the growth of the second economy in the euro zone suffered from household consumption without dynamism, stable despite the net withdrawal of inflation, after an increase of 0.2 % in the previous three months. Investments have evolved in negative territory (-0.2 % after -0.1 %) -both those of companies and households and public administrations are concerned, according to this first estimate of INSEE.

The contribution of foreign trade is also negative (-0.4 point) due to a marked decrease in exports (-0.7 %) while imports increased by 0.4 %. On the other hand, the variations in stocks have contributed positively to 0.5 points to the evolution of GDP.

The fall of the Barnier government in December had led to a delay of several weeks in the adoption of the 2025 budget-finally promulgated in mid-February-and the temporary freezing of public spending at the previous year. Another penalizing factor, the 50 billion euros in drop in expenses and increase in debt on the budget to clean up very degraded public finances. However, according to INSEE, the public expenditure had hitherto allegedly alleviated the weakness of the investment. A new 40 billion effort is hoped for in 2026.

According to Eurostat, France displays the worst public deficit in the euro zone for 2024, at 5.8 %. The government intends to bring it back to 5.4 % then under the European ceiling of 3 % in 2029. Its debt (113 % of GDP) is the third heavier after Greece and Italy.

To keep its deficit target in 2025, the government also acted on Saturday 3.1 billion euros in credits. A « New cup » which, according to The president of the finance committee of the National Assembly, Eric Coquerel (LFI), « Should have a recessive effect ». The deputy demands the deposit by the government, at « Spring or early summer », of a corrective finance bill so that the parliament can « Discuss new recipes ».

In this context, After 1.1 % in 2024growth is expected in net slowdown in 2025, at 0.7 % by the government as the Banque de France, with the risk of seeing unemployment go up slightly. The governor of the central bank, François Villeroy de Galhau, did not exclude Monday « A tendency to slowdown » when updating the institution’s forecasts in June, while also focusing on « Certain elements that can play positively, such as reviving in Germany ».

INSEE does not yet provide an annual forecast, while the IMF is counting on growth of 0.6 % for 2025.