Country Economic Forecasts > France

After a solid start to 2016, the French economy has suffered a series of setbacks including strikes, terrorist attacks and floods and GDP rose by a disappointing 0.2% q/q in Q3 following a small decline in Q2. Despite this softness, however, other key indicators point to underlying improvement with consumer spending supported by a gradual fall in unemployment and investment underpinned by recovering credit growth, rising capacity utilisation and corporate profitability. GDP growth is therefore still expected to edge up to 1.3% this year. We have, however, nudged down our 2017 growth forecast to 1.4% on the back of fresh uncertainty generated by Donald Trumps election win particularly on investment and trade. And there is also rising uncertainty on the domestic political scene, as politicians and parties manoeuvre ahead of presidential elections next year.