French Q1 GDP Stronger Than Expected

FLASH Q1 GDP +0.4% Q/Q SA, +1.5% Y/Y WDA

Q1 HH CONSUMPTION EXPENDITURE +0.3% Q/Q

Q1 GOVT CONSUMPTION EXPENDITURE +0.5% Q/Q

Q1 EXPORTS -1.5% Q/Q; IMPORTS -0.1% Q/Q

• The French economy expanded by 0.4% in Q1 after the contracting 1.4% in Q4 2020.
• Q1 growth came in stronger than market expectations (median 0.1%).
• Annual GDP rose by 1.5% in Q1 following Q4's drop by -4.8% and marking the highest level since Q3 2019.
• Despite the Q1 uptick, GDP remains 4.4% below the level seen in Q4 2020, the last quarter before the pandemic impacted GDP.
• Q1's gain was driven by an increase of government and household spending, up 0.5% and 0.3%, respectively, amid rising infection rates and a tight restrictions.
• Meanwhile, exports fell by 1.5% and imports declined by 0.1% in Q1, as a result foreign trade contributed negatively to GDP growth, shaving off 0.4pp.

Source: Insee