PARIS: The French economy returned to growth in the first quarter, sustained by consumer spending even after Covid-19 restrictions were re-imposed to curb a surge in infections, official data showed Friday. GDP edged up 0.4 percent from the final three months of 2020, a year that saw the coronavirus outbreak plunge countries worldwide into historic recessions, the Insee statistics agency said.
“However, the economic rebound was limited, as GDP is still 4.4 percent below its level of the fourth quarter 2019,” before the Covid pandemic began raging across Europe, the agency said.
Insee had originally forecast one percent growth for the quarter, but in March French authorities began ordering business closures and travel bans in several regions ahead of a third national lockdown implemented in April.
President Emmanuel Macron announced Thursday a phased reopening of the country by end-June, hoping the vaccination drive will let shops, restaurants and cultural venues find a semblance of normalcy.
Consumer spending dropped 1.1 percent in March, but managed to stage a “moderate rebound” of 1.2 percent for the first quarter as a whole, Insee said.
“Households remain confident, they have high levels of savings, and businesses are also sitting on large cash piles,” said Selin Ozyurt, senior economist at the credit insurance and research group Euler Hermes.
Comments
Comments are closed for this article.