In line with the forecasts of the National Institute of Statistics and slightly lower than those of the Banque de France (0.25%), growth benefited from a slight increase in services (0.5%), down however by compared to that of spring (1%).
“As it is above all a question of reducing production arrears, it is difficult to characterize the economic performance of the third quarter as very solid”, judge in a note Charlotte de Montpellier, economist at ING.
The last three months of the year should be more difficult, with zero growth expected in the 4th quarter by INSEE, which forecasts a rate of 2.6% for the whole of 2022 (0.1 point below the government estimate).
Inflation, which picked up sharply to 6.2% year-on-year in October after slowing in August and September, has already started to squeeze the wallets of the French.
The third quarter “is the last hurray before entering recession”, slice Maxime Darmet, economist at Allianz Trade.
The Governor of the Banque de France François Villeroy de Galhau nuanced this by saying that the French growth range for 2023 (-0.5 to 0.8%) was not intended to be revised, “a fortiori after 0, 2%” of the third quarter.
“In the euro zone, elements are pulling down the base forecast for September (0.9%)”, he added in the online program Ecorama.
In Spain, growth slowed sharply in the third quarter to 0.2%, while Germany saw its GDP grow by 0.3% over the same period, according to initial estimates.
– End of euphoria –
With prices appreciating at an unprecedented speed since the mid-1980s, French households are “hardly feeling the drop in their purchasing power”, says Maxime Darmet.
Data for the third quarter are not yet available but INSEE has already recorded a decline in purchasing power in the first half.
What pushes households to save: INSEE predicts an increase in the savings rate by the end of the year (17% against 15.5% in the first half).
Household consumption expenditure on accommodation and food services has already started to shrivel up this summer, falling from 12.7% in the 2nd quarter to just 0.6% over the period from July to September.
The two sectors, however, traditionally benefit from the influx of tourists in the heart of summer and had benefited from exceptional spending in the spring after two years of pandemic.
“The post-Covid euphoria is over when it comes to spending on services,” comments Mr. Darmet.
“During the summer, we realized that things were not improving and that the prices of gas and electricity” continued to increase, which may have encouraged the French to moderate their consumption, adds- he told AFP.
Goods and services combined, household consumption, the usual driver of the French economy, therefore stagnated in the third quarter (0.0% after 0.3%).
In detail, energy consumption remains well oriented (0.6%) unlike food consumption, down 1.6% over the quarter, the continuous increase in food prices forcing consumers to tighten their belt.
On the corporate side, however, investment remains encouraging and is even progressing compared to the spring.
“It is not surprising insofar as companies anticipate more difficult times in the fourth quarter and therefore take advantage of favorable financing conditions” before a hardening, deciphers Mr. Darmet.
“The contribution of foreign trade is negative this quarter (-0.5 point, after 0.0 point in the two previous quarters)”, adds INSEE, due to weaker expansion in exports (0.7%) than imports (2.2%).
The decline in exports is particularly marked in services (-0.4% after 3.3% in the spring).
