Estimated at 0.2% in the first quarter, growth is slightly better than expected, according to INSEE

Is the step to reach 1% growth in 2024 too high? If the executive refuses for the moment to modify this forecast, a new publication from INSEE this Tuesday morning reminded us that this objective will be difficult to achieve, but not impossible. According to experts, over the first three months of the year, growth did slightly better than expected, reaching 0.2%. Enough to bring the growth achievement for 2024 to 0.5%... And allow Bruno Le Maire to underline the success of “the government’s strategy”.

In detail, activity benefited from household consumption of food, energy and services, on the one hand, as well as a rebound in business investment, on the other. “Conversely, the contribution of foreign trade to growth is declining and is zero in the first quarter,” adds the INSEE note: imports increased slightly, as did exports, more frankly.

“It’s a good surprise compared to what we expected,” reacted Tuesday morning the boss of INSEE, Jean-Luc Tavernier, on the set of BFM Business. The 1% growth target is “not out of reach”, he added: “We need to continue to wake up. It’s not done, but it’s not out of reach.” “Consumption is a little better, it is waking up. [...] It is an awakening which is still timid, but which is evident,” commented the representative, adding that business investment “is also resisting”.

As a reminder, in their latest economic note with the euphemistic title - "The recovery is slow to come" - in March, the national statisticians, pessimistic, said they expected zero growth over the first three months of the year. “The first data available for January 2024 (notably industrial production and household consumption) are [...] poorly oriented and growth would be zero in the first quarter, penalized by occasional stoppages in industry, particularly in refining and the automobile,” they specified. And this, before a slight rebound in the second quarter, to 0.3%.

For their part, the other institutions were also rather cautious, counting on mediocre growth in the first quarter and a lower rate than the government's forecasts for the year as a whole. Last month, the Banque de France bet on 0.2% growth over three months, and 0.8% over the year, when the OFCE even spoke of 0.1% in the first quarter and “0.5% on annual average in 2024. An estimate revised downwards, once the latest budget cuts announced by the government are taken into account, on the one hand, and the slowdown in consumption on the other hand, explained the authors. The IMF, for its part, was counting on French growth of 0.7% this year, a rate lower than the United States, Spain and the European Union average, but higher than Germany as well. than in the United Kingdom.

Caught between its promise to put the accounts back on track by bringing the deficit below 3% of GDP, on the one hand, and its desire to defend growth and investment, on the other hand, the executive found on an increasingly narrow ridge line. And this, under the watchful eye of rating agencies and the European Union, which wants to see Paris respect its commitments. The billions in savings announced by the government recently risk “disrupting growth”, making the equation all the more difficult to resolve, noted Monday the first president of the Court of Auditors, Pierre Moscovici. “Either you have growth, and you do not have 3%, or you have 3%, and you do not have growth, and you will have to make even more savings” in the future, he summarized .

For now, however, Bercy is sticking to its positions and maintaining its course, favoring activity over any tax increase. “We will stick to our strategy based on growth and full employment, structural reforms and the reduction of public spending,” reaffirmed Bruno Le Maire last Friday. Everything suggests that Tuesday morning's figure, slightly better than expected, should reassure the minister in his positions. “The facts are stubborn. French growth is progressing. This is a new sign that reflects the solidity of our economy. The government’s strategy is paying off,” the boss of Bercy immediately welcomed, after the publication of the INSEE figures.