Insee conjoncture
21 septembre 2018
N° 2018-247

Households' purchasing power went up in Q2 (+0.7% after -0.5%)Quarterly national accounts - detailed figures - second quarter 2018

In Q2 2018, GDP in volume terms* grew at the same rate as in Q1: +0.2%. Household consumption expenditures faltered slightly (−0.1% after +0.2%), whereas total gross fixed capital recovered sharply (GFCF: +0.8% after +0.1%). Overall, final domestic demand excluding inventory contributed as much to GDP growth as in Q1 (+ 0.2 points).

Imports bounced back during this quarter (+0.7% after −0.6%), as did exports to a lesser extent (+0.1% after −0.4%). All in all, foreign trade balance contributed negatively to GDP growth: −0.2 points after +0.1 points. Conversely, changes in inventory drove GDP on (+0.2 points after −0.1 points).

Informations rapides
No 247
Paru le : 21/09/2018
Prochaine parution le : 26/03/2019 at 08:45 - fourth quarter 2018

In Q2 2018, GDP in volume terms* grew at the same rate as in Q1: +0.2%. Household consumption expenditures faltered slightly (−0.1% after +0.2%), whereas total gross fixed capital recovered sharply (GFCF: +0.8% after +0.1%). Overall, final domestic demand excluding inventory contributed as much to GDP growth as in Q1 (+ 0.2 points).

Imports bounced back during this quarter (+0.7% after −0.6%), as did exports to a lesser extent (+0.1% after −0.4%). All in all, foreign trade balance contributed negatively to GDP growth: −0.2 points after +0.1 points. Conversely, changes in inventory drove GDP on (+0.2 points after −0.1 points).

GraphGDP and its main components

  • Source: INSEE

* This growth rate is seasonally and working-day adjusted; volumes are chain-linked previous-year-prices volumes.

Tab1GDP and its main components: chain-linked volumes

percentage change from previous period, working-day and seasonally adjusted data
GDP and its main components: chain-linked volumes
2017 Q3 2017 Q4 2018 Q1 2018 Q2 2017 2018 (ovhg)
GDP 0.7 0.7 0.2 0.2 2.3 1.3
Imports 1.9 0.3 -0.6 0.7 4.1 1.0
Household consumption *expenditure 0.4 0.2 0.2 -0.1 1.1 0.6
General government's *consumption expenditure 0.6 0.2 0.1 0.2 1.4 0.8
GFCF 1.3 1.0 0.1 0.8 4.7 2.3
*of which Non-financial corporated and unincorporated enterprises 1.6 1.3 0.1 1.2 4.4 2.9
Households 1.1 0.7 0.3 -0.1 5.6 1.6
General government 0.3 0.3 0.1 0.5 1.6 1.0
Exports 1.0 2.2 -0.4 0.1 4.7 2.5
Contributions:        
Internal demand excluding inventory changes 0.6 0.4 0.2 0.2 2.0 1.1
Inventory changes 0.3 -0.3 -0.1 0.2 0.2 -0.2
Net foreign trade -0.3 0.6 0.1 -0.2 0.1 0.4
  • Source: INSEE

Tab2Production, consumption and GFCF: main components

percentage change from previous period, working-day and seasonally adjusted data
Production, consumption and GFCF: main components
2017 Q3 2017 Q4 2018 Q1 2018 Q2 2017 2018 (ovhg)
Production of branches 0.8 0.9 0.1 0.3 2.6 1.6
Goods 0.8 1.1 -0.6 -0.2 2.2 0.7
Manufactured Industry 0.7 1.4 -1.0 -0.1 2.4 0.6
Construction 0.5 0.5 -0.4 0.5 3.5 0.9
Market services 0.9 1.1 0.5 0.4 3.2 2.3
Non-market services 0.5 0.3 0.2 0.3 1.1 0.9
Household consumption 0.4 0.2 0.2 -0.1 1.1 0.6
Food products -0.5 0.2 -0.3 -1.3 0.3 -1.2
Energy 1.3 -0.7 0.8 -1.8 0.1 -0.1
Engineered goods 1.1 -0.1 -0.2 1.2 2.6 1.3
Services 0.5 0.4 0.5 0.1 1.6 1.2
GFCF 1.3 1.0 0.1 0.8 4.7 2.3
Manufactured goods 1.7 1.8 -1.0 1.5 3.7 2.4
Construction 0.7 0.3 0.0 0.4 3.5 1.3
Market services 1.8 1.3 1.0 0.6 7.0 3.6
  • Source: INSEE

Purchasing power bounced back in Q2 2018

Households' gross disposable income (HDI) grew in current euros in Q2 2018 (+1.1% after +0.1%). The gross payroll growth slowed down slightly (+0.7% after +0.9%), but was balanced by a decrease in the taxes on income and wealth. This decrease has been due to the substitution of the wealth tax (ISF), by the property tax (IFI). Households' social benefits growth has remained constant (+0.5% during both quarters).

Households' consumption prices slowed down slightly in Q2 (+0.4% after +0.6%), mainly because the energy prices increased slowly, so that the purchasing power bounced back clearly in Q2 (+0.7% after −0.5%). When measured per consumption unit, it has also recovered (+0.6% after −0.6 %). Households' consumption decreased a bit (−0.1% after +0.2%), while purchasing power grew. As a result, the saving rate went up: it stood at 14.3% after 13.7% in Q2 2018.

Tab3Sectoral accounts

percentage change from previous period, working-day and seasonally adjusted data
Sectoral accounts
2017 Q3 2017 Q4 2018 Q1 2018 Q2 2017 2018 (ovhg)
Profit ratio of NFCs* (level) 32.1 32.0 32.0 31.5 32.0  
Households' purchasing power 0.5 0.2 -0.5 0.7 1.4 0.6
  • *NFCs: non-financial corporations
  • Source: INSEE

Tab4Households' disposable income and ratios of households' account

percentage change from previous period, working-day and seasonally adjusted data
Households' disposable income and ratios of households' account
2017 Q3 2017 Q4 2018 Q1 2018 Q2 2017 2018 (ovhg)
HDI 0.6 0.7 0.1 1.1 2.7 2.0
Household purchasing power 0.5 0.2 -0.5 0.7 1.4 0.6
HDI by cu* (purchasing power) 0.4 0.1 -0.6 0.6 0.9 0.2
Adjusted HDI (purchasing power) 0.5 0.2 -0.3 0.6 1.5 0.7
Saving rate (level) 14.3 14.3 13.7 14.3 14.2  
Financial saving rate (level) 4.4 4.4 3.7 4.2 4.4  
  • *cu: consumption unit
  • Source: INSEE

Non-financial corporations' profit ratio decreased

In Q2 2018, non-financial corporations' profit ratio decreased at 31.5% (after 32.0%). It is due to the decline of productivity gains, the slight rebound of real wages and the further deterioration of the terms of trade.

Tab5Ratios of non-financial corporations' account

level (in percent), WDA-SA data
Ratios of non-financial corporations' account
2017 Q3 2017 Q4 2018 Q1 2018 Q2 2017
Profit share 32.1 32.0 32.0 31.5 32.0
Investment ratio 23.5 23.6 23.6 23.9 23.5
Savings ratio 23.0 22.3 22.8 22.4 22.5
Self-financing ratio 97.7 94.4 96.5 93.8 95.9
  • Source: INSEE

General government deficit increased slightly in Q2 2018

In Q2 2018, general government net borrowing increased a little (+0.1 points): the public deficit stands at 2.5% of the GDP after 2.4% in Q1 2018.

General government expenditure declined slightly in Q2 (−0.2% after +0.6%). Indeed, the amounts paid to businesses to refund the 3% tax on dividends still decreased. Moreover, both the French contribution to the European budget and subsidies slowed down after a dynamic Q1, mainly due for the latter to the increase in CICE regarding wages paid in 2017.

Government receipts declined (−0.3% after +0.1%), mostly because of the decrease in the taxes on income and wealth. This decrease is due to a cut of the corporate income tax rate for income up to 500,000€ and the substitution of the wealth tax (ISF) by the property tax (IFI).

Tab6Expenditure, receipts and net borrowing of public administrations

level, WDA-SA data
Expenditure, receipts and net borrowing of public administrations
2017 Q3 2017 Q4 2018 Q1 2018 Q2 2017
In billions of euros      
Total expenditure 326.8 327.1 329.1 328.3 1294.3
Total receipts 309.0 314.6 314.8 313.8 1232.7
Net lending (+) or borrowing (–) -17.8 -12.4 -14.3 -14.5 -61.6
In % of GDP      
Net lending (+) or borrowing (–) -3.1 -2.1 -2.4 -2.5 -2.7
  • Source: INSEE

Revisions

GDP growth estimate for Q1 2018 is confirmed at +0.2%. Slight revisions in different aggregates offset each other; they are mainly due to the revision of indicators and to the update of seasonal adjustment coefficients. The purchasing power growth for Q1 is revised by +0.1 points, mainly due to an increase in dividends received by households.

Documentation

Methodology (pdf, 140 Ko)

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