France: what can we learn from latest GDP and inflation figures ?

The publication of the French national accounts on a new basis year was accompanied by significant revisions to some macroeconomic aggregates. GDP growth reached 6.8% in 2021, 2.6% in 2022 and 1.1% in 2023, compared to 6.4%, 2.5% and 0.9% previously estimated (2014 base). For Q1 2024, quarterly GDP growth was unchanged at 0.2%. However, the upward revisions made to 2023 result in a slight increase in the growth overhang for 2024 at the end of the first quarter, from 0.5% to 0.6%. Given these revisions, we maintain our scenario of a 1.1% increase in GDP in 2024. On the inflation side, the preliminary estimate of the May figures revealed a stabilisation of inflation (CPI): 0% MM and 2.2% y-o-y, i.e. a result below expectations (2.4%). Price increases in services slowed from 3% in April to 2.7% in May. The provisional results for May also confirm our scenario of a return of inflation to around 2% in France. For the year as a whole, CPI inflation is expected to average 2.1%, after 4.9% in 2023 .