France's second-quarter GDP growth rate exceeds expectations

The French economy in the second quarter of 2024 increased 0.3% from the previous fiscal year, which was the same as the upward revised value for the first quarter, but it exceeded the 0.2% increase in market expectations.

While domestic final demand (0.1 pts) and net trade (0.2 pts) contributed positively, strong growth since the 2nd quarter of 2023 was maintained on a quarterly basis.

Household consumption remained almost flat (down 0.1% in the first quarter) because product purchases stagnated while gas and electricity consumption increased due to the cold in early spring.

At the same time, government spending continued to increase (0.3% increase, 0.6% increase).

Fixed investment increased 0.1% after falling 0.4% in the first quarter. This was helped by investment in market services, particularly information and law/scientific services, but investment in manufactured goods declined further, mainly in transportation equipment and capital goods (down 1.0% compared to a 0.6% decrease).

Meanwhile, exports remained strong (0.6% increase, 0.7% increase), while imports remained flat (same period last year: 0.3% decrease).

The full-year economic growth rate increased 1.1%, which was lower than the 1.5% increase in the first quarter, which was revised upward.

Source: France INSEE