France’s economy eked out a small expansion in 2022’s fourth quarter, shrugging off recession fears for this winter as the government cushioned households and businesses from high energy prices.
The French economy, eurozone’s second-largest, grew by a marginal 0.1% from October to December compared with the previous three-month period, slowing from a 0.2% expansion recorded in the third quarter, according to preliminary data from the country’s statistics office Insee released Tuesday.
Economists polled by The Wall Street Journal expected the economy to stagnate over the quarter.
Household consumption declined by 0.9% on quarter, suggesting inflation took its toll on spending, Insee said. Business investment slowed sharply but contributed positively to growth, as it did foreign trade.
France’s economy expanded by 2.6% in 2022 as a whole, helped by resilient demand and the rebound in the services sector.
Recent surveys suggest economic activity in has held up in early 2023, but the economy is expected to slow markedly this year and grow 0.3%, according to the latest macroeconomic projections from the Bank of France released in December. The possibility of a recession this year can’t be ruled out, the central bank said, but expects any upcoming contraction in activity to be limited and temporary.
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