PARIS: France’s economy is estimated to have grown slightly more than previously expected in the last quarter of 2023, boosted by the services and industry sectors, the central bank said on Wednesday.
The euro zone’s second-biggest economy is estimated to have grown 0.2% from the previous quarter, when it unexpectedly contracted by 0.1%, the Bank of France said in its monthly business survey of about 8,500 firms carried out between Dec. 20 and Jan. 5.
That marks a step up from its growth forecast last month, which was narrowed to 0.1% from 0.1-0.2% previously.
December industrial growth provided a “positive surprise” and, together with growing services, would help offset declines in construction and energy, the latter attributed to higher than usual temperatures at the start of the quarter, the bank said.
In January, services and industry are expected to continue growing, though at a slower pace, with construction contracting further, it said.
With the period for annual price revisions approaching, 18% of business executives plan to increase prices in industry against 16% in construction and 23% in services, fewer than in January last year.
European Central Bank policymakers said earlier on Wednesday that the euro zone as a whole may have been in recession last quarter, and prospects in the near term remained weak.
If France’s fourth-quarter gross domestic product (GDP) rate is confirmed by statistics office INSEE, the bank said it would raise its 2023 growth estimate back to 0.9% from the previous 0.8%.
INSEE is scheduled to release preliminary fourth-quarter GDP figures on Jan. 30.
For the first half of 2024, INSEE has predicted growth of just 0.2% in both the first and second quarters, while the central bank has estimated the economy will only pick up in 2025, as slowing inflation should lead to a consumer spending recovery over 2024, pushing overall economic growth to 1.3% in 2025 and 1.6% in 2026.
There is no change in what the bank anticipates for the beginning of this year, it added on Wednesday.
(Reporting by Piotr Lipinski Editing by Mark Potter)
