PARIS (Reuters) – The French economy is likely to experience weakly positive growth next year, Banque de France Governor François Villeroy de Galhau said on Friday, without ruling out a “temporary and limited” recession.
The central bank still forecasts growth of 2.6% this year, he added to the microphone of franceinfo. “To put it another way (…), our economy has held up well this year. That’s pretty much the good news.”
“We are approaching a sharper turn in 2023, probably weakly positive growth. I cannot rule out a recession, but that is not our central scenario,” said the governor of the central bank.
In its macroeconomic projections published in mid-September, the Banque de France had put forward a range of forecasts for 2023, from growth in activity of 0.8% to a contraction of -0.5%, depending on the evolution of energy prices and government measures to deal with this crisis.
“If there were to be a recession, it would be temporary and limited. What we are ruling out today is a hard landing for the French and European economy,” said François Villeroy de Galhau.
“A sharper turn next year and to chart the 2024 outlook, we should then be back on a more normal course with less inflation and more growth,” he added.
The Governor of the Banque de France also indicated that the Livret A rate, currently at 2%, would be raised again in early February.
(Written by Jean-Stéphane Brosse, edited by Nicolas Delame)
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