Macroeconomic projections – June 2024

Published on 12 June 2024

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.

  • Our new macroeconomic projections were finalised on 22 May 2024. Our baseline scenario remains that of a gradual exit from inflation without a recession, which should allow for a more marked recovery in 2025 and 2026.
  • On the whole, the uncertainties surrounding this baseline scenario remain high and are balanced for economic growth and for inflation. As usual, we have adopted a no-policy-change assumption
  • After still reaching 5.7% in annual average terms in 2023, inflation is set to fall sharply to an annual average of 2.5% in 2024, followed by 1.7% in 2025 and 2026, due to lower inflation for food, energy and manufactured goods. Services inflation is expected to fall more slowly.
  • Economic activity is expected to continue to grow at a moderate pace in 2024, by 0.8%. However, household consumption should benefit from the recovery in purchasing power driven by the fall in inflation. In 2025 and 2026, growth should therefore strengthen to 1.2% and 1.6%, respectively, also buoyed by the recovery in private investment as interest rates ease.
  • This forecast is based on the assumption of a significant reduction in the government deficit, to around 4% of GDP in 2026. In any case, the upcoming period of gradual recovery and monetary easing is not unfavourable to the necessary fiscal consolidation needed to bring public debt under control.
  • We continue to forecast a lagged adjustment of employment to the economic slowdown, with only a partial recovery of past productivity losses noted since the pre-Covid period. Consequently, the unemployment rate, which is lower than initially forecast in 2024, is expected to rise temporarily in 2025, before coming down again in the wake of the upturn in activity to stand at 7.6% at end-2026.

Updated on 12 June 2024