France's Economic Forecast: A Downward Revision

The Bank of France plans to lower its 2026 economic growth estimates due to unexpected contraction in the first quarter of the year. Outgoing central bank head François Villeroy de Galhau announced the adjustment, as the economy shrank slightly contrary to previous flat growth predictions.

The Bank of France has announced plans to lower its 2026 economic growth estimates following an unexpected contraction in the first quarter of this year.

According to François Villeroy de Galhau, the outgoing head of the central bank, the first quarter's negative performance was a 'bad surprise' that necessitates revised forecasts. This follows final data from France’s statistics office INSEE, which showed a slight economic shrinkage, missing earlier predictions of stable 0.0% growth for the euro zone's second-largest economy.

Villeroy de Galhau stated on Radio Classique that while several scenarios will be considered in the forecast adjustments, the growth projections for 2026 will be reduced but remain positive in most cases.