Just before the opening of the sacrosanct “reserve period” which must precede an election – and which therefore prohibits the publication of economic indicators -, INSEE has delivered a series of studies which blow hot and cold. cold. On the good news side, the depth of the recession in 2020 has been very slightly less than measured in early estimates. The gross domestic product (GDP) fell by 7.9% (8% taking into account calendar lags, instead of 8.2%).
On the less good side, the indicators show that activity remained flat in the first quarter, with a contraction of activity of 0.1% while the first estimates indicated a resumption of growth, with an estimate increase in GDP estimated at + 0.4%. A correction mainly due to construction, which did not experience the strong recovery hoped for. Regarding household consumption, often presented as the engine of the recovery, there was no favorable inflection at the start of the year either. In April, it even fell by 8.3%, households no doubt waiting for the reopening of stores, restaurants or places of leisure to loosen the purse strings.
A “mechanical” downward revision, according to Bercy
For Nicolas Carnot, director of economic studies and summaries at INSEE, this correction is not worrying: “We must put things in perspective: the French economy has been on a plateau since last December, it is running at 95% of its pre-crisis capacity. The economic indicators for May confirm the idea that the rebound may be very sharp from now on in the coming weeks. ”
An analysis shared by Bercy. The Ministry of the Economy does not intend to correct its growth forecasts and therefore maintains the objective of GDP growth of 5% for 2021, which remains the macroeconomic assumption on which the draft amending budget, presented in the Council of Ministers on Wednesday 2 June. The downward revision of growth in the first quarter is ” mechanical “, indicated the Minister of the Economy and Finance, Bruno Le Maire, Friday morning, because “Linked to a recession less severe than expected in 2020”. “This does not change our ambition for 2021 to have 5% growth, to deploy as quickly as possible as we are doing the recovery plan and France Relance”, he continued. “In times of crisis, you have to keep your cool and consistency, not give in to one figure or another”, adds the Minister. Bercy’s debt and deficit forecasts for 2021 will be adjusted in the coming days.
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