We now expect the French economy will grow by 1.1% in 2024 and slow down to 0.9% in 2025, after trimming our GDP growth forecasts for both years by 0.1ppt. We think industry will likely take slightly longer to rebound, which will weigh on inventories this year. The negative fiscal impulse from the 2025 Budget will inevitably drag growth next year, as government spending slows down and higher corporate taxes hurt investment and wages.
France: The 2025 budget is set to dampen growth next year