France’s Economic Outlook

PARIS (Reuters) – France’s economy is expected to experience minimal growth in the first half of the year. According to the national statistics agency INSEE, consumer spending is struggling to counteract the effects of weak business activity and government budget tightening.

After a contraction of 0.1% in Q4 of the previous year, the economy is projected to grow by only 0.1% in Q1 and 0.2% in Q2. The modest growth is expected to be supported by higher consumer spending, forecasted to increase by 0.4% in Q1 and 0.2% in Q2, driven by wage gains.

However, this increase in consumer spending may be offset by stagnant public spending as the government attempts to control its budget deficit through higher taxes, which particularly affects the corporate sector.