France's GDP grew by 0.3% in the second quarter, a higher-than-expected growth rate

A traditional pillar of growth, household consumption rebounded slightly (+0.1%) after a decline of 0.3% in the first quarter.

France's economic growth is stronger than expected, even if it remains minimal. In the second quarter, gross domestic product (GDP) increased by a moderate 0.3%, the French National Institute of Statistics (INSEE) announced on Wednesday, July 30, in its first estimate for the period from April to June. In a highly uncertain national and international context, the organization had anticipated growth of 0.2% after +0.1% in the first quarter.

Inventories, which represent goods produced but not yet sold at the end of a given period, drove growth with a positive contribution of 0.5 points, after a gain of 0.7 points in the first quarter, INSEE detailed. Here, these inventories consist of aeronautical and automotive equipment. However, excluding inventories, final domestic demand stagnated.

A traditional pillar of growth, household consumption rebounded slightly, by 0.1% after a 0.3% decline in the first quarter, driven by increased consumption of food products. "This recovery can be explained in particular by the timing of the Easter holidays at the end of April and favorable weather in April and May," explained INSEE.

Households also consumed more services, while mild temperatures weighed on energy consumption, which fell by 2.4% (after +0.8%). In April and June, investments plunged into the red (-0.3% after -0.1%), penalized in particular by construction.

In an environment marked by the trade war launched by the United States in April, the contribution of foreign trade to growth remained negative, at -0.2 points after -0.5 points, the slight rebound in exports having been offset by an acceleration in imports.