There seems to be light at the end of the tunnel. “We do not see a recession,” assured this Thursday the governor of the Bank of France, François Villeroy de Galhau. The latter wants to be reassuring and specifies at the microphone of Radio Classique a “slightly positive growth” for this fourth quarter, “between 0.1% and 0.2%”.
If he does not rule out a “confirmed slowdown in all sectors”, including services or buildings, “activity has more or less held up”. Added to this is a “slowdown in jobs”, but “much less” than during previous “cycles of slowdown in activity”. “The employment situation has improved very significantly” in recent weeks, adds François Villeroy de Galhau.
On the inflation side, “we are really going in the right direction,” enthuses the governor of the Bank of France. At 7% a year ago, inflation is now set at 4% in October. Certainly, “there will be volatility”, anticipates François Villeroy de Galhau, but “there is a downward trend over time”. Same observation for oil, which “has tended to decline”. “The French will feel it in the price at the pump,” promises the governor.
He also recalls the commitment of the Banque de France to bring “inflation towards 2% by 2025”. “The disease is inflation, the cure is interest rates,” underlines François Villeroy de Galhau, who recognizes that this solution “is not pleasant, but effective.” “Our interest rates will no longer rise and the day of decline will come when everyone is convinced that inflation is returning to around 2%,” he concludes.