The OECD on Wednesday significantly raised its 2024 growth forecast for France to 1.1%, up from 0.7% forecast in May, with the country’s economy expected to benefit from the central bank’s rate cut, a surge in consumption and a “DO effect,” according to the institution.
The Paris-based international organisation’s growth forecast is now on par with figures from INSEE and the Banque de France, whose data were influenced by a revision of French accounting data at the start of the year.
This forecast is slightly better than that of the outgoing government, which expected 1%.
0.25 points for the JO effect
The Organisation for Economic Co-operation and Development (OECD) believes that the slowdown in inflation in France and the eurozone has allowed the European Central Bank (ECB) to lower its interest rates, which would help finance the economy and boost growth on the continent. The Frankfurt-based institution lowered its rates in mid-September for the second time in three months, and could do so again in December.
According to the OECD, excluding volatile prices, inflation is expected to reach 2.4% this year in 2024 and 1.9% next year, far from the 5.7% recorded in 2023.
According to the Banque de France, the positive impact of the Olympic Games should bring 0.25 points of additional growth to France in the third quarter.
Although it revised French growth upwards for 2024, the OECD slightly lowered its forecast for 2025, bringing it to 1.2%, a decrease of 0.1 points compared to previous forecasts.
Source: BFM TV
