France's economy grew in the first quarter as anticipated, but the growth rate slowed following a revision to the fourth quarter data, as reported by the national statistical office INSEE on Friday.
The gross domestic product (GDP) increased by 0.2 percent compared to the fourth quarter, aligning with the estimate released on April 30. The growth for the fourth quarter was adjusted upward to 0.3 percent from the previously reported 0.1 percent. On the expenditure side, household consumption growth was halved to 0.1 percent in the first quarter, largely due to reduced spending on transport equipment.
Gross fixed capital formation decreased by 0.4 percent, driven by a 1.3 percent decline in construction investment and a 1.7 percent fall in capital goods investment. Conversely, government spending escalated by 0.6 percent. Overall, final domestic demand, excluding inventories, positively contributed 0.1 points to the GDP growth for the quarter.
Export growth increased to 1.2 percent from the previous 1.0 percent, spurred by a rebound in shipments of agricultural products, transport equipment, and other manufactured goods.
Imports rebounded by 0.4 percent after a 1.7 percent decline, supported by an increase in imports of refined petroleum and transport equipment. Consequently, foreign trade contributed 0.2 points to GDP growth in this quarter.
However, the contribution of inventory changes to GDP growth remained negative at -0.2 points, following a -0.7 points contribution in the fourth quarter.
INSEE has revised the growth rate for 2023 to 1.1 percent from the previous 0.9 percent.
Another report from INSEE disclosed that household spending declined in April, primarily due to a significant drop in food consumption.
Household spending fell by 0.8 percent, contrasting with a 0.5 percent increase in March. Notably, food consumption decreased by 2.7 percent, while energy consumption rose by 1.3 percent.
