PARIS, July 30 (Ruga) -- The France economy is on a positive growth trend. France's gross domestic product grew by about 0.3% in the second quarter of 2024, with a rebound in foreign trade and business investment supporting economic activity, despite stagnant household consumption, according to preliminary estimates released by France's National Institute of Statistics and Economic Research (Insee) on July 30.
The interim report released by the National Institute of Statistics and Economic Research of France on July 30 estimated economic growth in the second quarter of 2024 higher than previously forecasted, expecting GDP to grow by 0.3% from April to June, AFP reported. In the spring of 2024, France held early legislative elections and politics began to stalemate, but economic activity benefited from the positive contribution of foreign trade and exports remained buoyant, the institute noted.
On the investment front, business investment returned to positive in the second quarter, edged up 0.1% after two previous quarters of negative. This was driven by an acceleration in investment in the services sector, offsetting the impact of the continued decline in the manufacturing sector. In contrast, despite the European Central Bank's (BCE) rate cut in June, household consumption remained low, falling by 0.5%, against the backdrop of interest rates remaining high.
For the third quarter, the France National Institute of Statistics and Economic Research had predicted in early July that the Olympic and Paralympic Games in Paris from 26 July to 11 August and from 28 August to 8 September would have a positive impact on the economy, which, together with the recovery of household consumption, would lead to stronger economic growth. It is estimated that this "Olympic effect" will have an impact of 0.3 percentage points on economic growth, bringing the overall growth to 0.5%. The institute also raised GDP growth by 0.1 percentage points in the fourth quarter of 2023.