France’s expected economic growth for 2025 has been revised downwards for the second time in three months, by central bank the Banque de France due to the impact of the EU’s ongoing trade dispute with the United States and a persistently uncertain global outlook.
French GDP is now expected to rise by just 0.6% in 2025, down from a previous estimate of 0.7% in March and 0.9% earlier this year.
The revised forecast brings the French central bank in line with forecasts of the Organisation for Economic Co-operation and Development and the International Monetary Fund, and below the government’s target of 0.7%.
Growth for 2026 and 2027 is forecast to recover to 1.0% and 1.2% respectively, although this too is slightly weaker than previously predicted.
The main drivers are expected to be household consumption and private investment, helped by falling inflation and interest rates.
Trade, by contrast, is seen as a drag on growth due to reduced exports and a stronger euro.
Even if no further escalation follows, the overall effect on the French economy is projected to be a 0.4 percentage point loss in GDP between 2025 and 2027 – mostly due to the uncertainty the measures create.
France is aiming to bring the deficit down to 4.6% of GDP in 2026 and below 3% by 2029. Nonetheless, it remains one of the eurozone’s poorest performers in terms of fiscal policy, with public debt forecast to reach 120% of GDP by 2027.
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Despite the lower outlook, inflation is expected to remain under control.
The harmonised consumer price index is forecast to rise by just 1.0% in 2025, before edging up to 1.4% in 2026 and 1.8% in 2027. The bank believes the “victory over inflation” is likely to hold.
Employment remains resilient, with the jobless rate set to increase only marginally in 2025 before falling again.
