© Reuters. FILE PHOTO: People walk past a restaurant at the Butte Montmartre in Paris, France, July 10, 2023. REUTERS/Sarah Meyssonnier/File Photo
PARIS (Reuters) – The French economy is set to end a six-month phase of stagnation and expand by 0.1% to 0.2% in the first quarter, the country’s central bank said on Thursday as it released its monthly business survey.
“Declines in the construction and energy sectors were offset by a rise in value added in industry, while services remained stable”, the Bank of France said.
It also updated the growth rate measured during the fourth quarter of 2023, saying the economy had flatlined. It had previously given a 0.2% growth estimate.
Large-scale farmer protests that spread throughout France in January before coming to a halt last week had a negative impact on the transport and automotive sectors and to a lesser degree on restaurants, the survey said.
“But we don’t think that this crisis will significantly impact growth for the quarter and the year”, central bank chief Francois Villeroy de Galhau told paper Ouest France.
Business executives polled in the industrial sector were generally confident about their output levels in February, in particular in the food, auto and aero sectors while rubber, plastics and metal manufacturing appear set for a further contraction.
It also updated the growth rate measured during the the fourth quarter of 2023, saying the economy stagnated at 0.0. It had previously given a 0.2% growth estimate.
The Bank of France sees full-year growth at close to 0.9% this year, Villeroy said, adding:
“Amid a general slowdown, the situations differ from sector to sector. Overall, services resist more than manufacturing”.
