Macroeconomic projections
Economic conditions

Macroeconomic interim projections – March 2025

Published on the 12th of March 2025

Mosaïques d'hexagones avec avec en fond des symboles de réseau et d'analyse

In order to contribute to the national and European economic debate, the Banque de France periodically publishes macroeconomic forecasts for France, constructed as part of the Eurosystem projection exercise and covering the current and two forthcoming years. Some of the publications also include an in-depth analysis of the results, along with focus articles on topics of interest.

  • The macroeconomic scenario in these interim projections includes the assumptions in the budget for 2025, enacted on 14 February last. It also takes account of the 10 percentage point increase in US tariffs on imports from China, as well as the measures taken by China in response. It does not directly take account of the increase in customs duties on Mexico and Canada currently under discussion, nor those that may be upcoming on European goods (see box); however these indirectly affect the projections through the effects of uncertainty. Moreover, neither the recent proposals by the European Commission to increase military spending nor those likely to be submitted to Parliament in Germany have been factored in.
     
  • After the slight downturn in activity observed at the end of last year – a temporary payback after the positive effect of the Olympic Games in the summer of 2024 – GDP is expected to grow at a still moderate rate in the first half of 2025, before gathering pace in the second half of the year. Over 2025 as a whole, activity is expected to slow down but growth should remain positive, at an annual average rate of 0.7% (after 1.1% in 2024), before rising in 2026 and 2027 to 1.2% and 1.3%, respectively, close to the medium-term potential rate. Our forecast therefore confirms that the French economy is unlikely to fall into recession.
     
  • Compared with our December 2024 forecast, the downward revision to growth in 2025 (and more marginally in 2026) is due notably to the adjustment of our very short-term forecasts based on our latest monthly business surveys. In addition, the impact of less fiscal consolidation than envisaged last autumn should be offset by the uptick in international uncertainty and by current wait-and-see attitudes in view of the domestic situation.
     
  • After reaching an annual average of 2.3% in 2024, headline inflation should continue to fall significantly, to below 2% over the projection horizon. In 2025, it will be particularly low at 1.3%, due to the drop in services and electricity prices. In 2026 and 2027, headline inflation is forecast to remain moderate at 1.6% and 1.9%, respectively. Inflation excluding energy and food is expected to remain stable at 1.8% over the three-year period. This should drive a continued recovery in the purchasing power of wages – wages are rising faster than prices on average – and gradually boost household consumption.
     
  • There is still much uncertainty surrounding this forecast, linked to the geopolitical situation and, in particular, the uncertainties surrounding US trade policy and possible European responses. Overall, the risks to our GDP projection remain to the downside, although new upside risks could arise at the end of the period from an increase in military spending.

Updated on the 12th of March 2025