France started the year with no economic growth relative to the previous quarter, due to a contraction of consumption levels. GDP, however, is significantly higher than in the same quarter of the previous year, when COVID was still holding back economic activity. Since then, consumption levels have spiked and international trade has risen again. The economic recovery, production bottlenecks of Chinese manufacturing firms that were forced to stop during the pandemic, soaring energy prices, and uncertainties related to the Russian invasion of Ukraine, have contributed to increasing inflation rates, at 1.5 percent relative to the previous quarter and at 3.66 percent relative to the previous year. The OECD economic outlook expects annual inflation to decrease throughout the year, reaching 1.5 percent in 2023. GDP is expected to grow at an annual rate of 4.5-5.0 until the end of 2023, while unemployment is expected to remain constant around 7.5 percent in the next quarters.

July 2022