France – 2023-2024 Scenario: a smooth recovery despite headwinds

France – 2023-2024 Scenario


  • Summary
  • Recent trends in activity
  • Our scenario for 2023-2024

In summary

The French economy is making a soft landing following the post-COVID economic recovery in 2021 and the adverse effects of the outbreak of the war in Ukraine in 2022. The country has avoided a technical recession, with growth of 0.0% (qoq) in first-quarter 2023 and 0.5% in the second quarter. Growth is expected to be modest in the second half of 2023 as the effects of monetary tightening peak, but the rebound in household consumption linked to disinflation will enable gradual economic growth in 2024. Annual growth is expected to be 0.9% in 2023 then 1.0% in 2024.

France – 2023-2024 Scenario

Household consumption is expected to rebound timidly in second-half 2023 then more sharply in 2024 owing to a gradual decline in inflation and a slight decrease in the savings rate by the end of 2024. Business investment is expected to decline slightly at the end of 2023 amid tighter financial conditions. It is expected to be sluggish in first-half 2024 and rebound slightly at the very end of 2024, while interest rates are expected to gradually fall.

Marianne PICARD, Economiste - France, Belgique et Luxembourg