Between trade risks and fiscal stimuliConjoncture in France - June 2019

Julien Pouget - Frédéric Tallet - Thomas Ouin-Lagarde - Mikael Beatriz

Marked in particular by the trade tensions that started in the United States and by the prospect of Brexit, the international environment seems less buoyant than last year. However, both central banks and different governments have nonetheless noted the risk of a slowdown and are adjusting their economic policy accordingly. At the start of 2019, most of the main Eurozone countries introduced fiscal stimulus measures (in one way or another).

This is the case in France, with, among other things, the emergency measures announced in December 2018. At an aggregate level, household purchasing power is therefore expected to increase fairly sharply in 2019 (+2.3%, or +1.8% per consumption unit), in a context of contained inflation. This increase would only be gradually transmitted to household consumption, which would still be the main support for growth. French GDP is expected to increase by 0.3% per quarter by the end of 2019, representing an annual average growth rate of 1.3%, slightly higher than the growth forecast for the Eurozone as a whole (+1.2%). With 241,000 net job creations expected over the year, the unemployment rate is expected to continue to fall to 8.3% at the end of 2019.