FRANCE: The French economy is set to grow faster than expected earlier as export growth is expected pick-up on the back of the global economic recovery, the Bank of France said its bi-annual economic outlook report released on Friday. The bank raised the growth forecast for this year to 1.4 percent from 1.3 percent seen in December. The outlook for next year was increased to 1.6 percent from 1.4 percent. The projection for 2019 was also upped to 1.6 percent from 1.5 percent. “This revision chiefly reflects more buoyant demand for French exports, even though this effect is partly mitigated when expressed as an annual average for 2017 by the carry-over from the disappointing export performances observed at the start of the year,” the bank said. The HICP inflation forecast for this year was maintained at 1.2 percent, but the outlook for next year was trimmed to 1.2 percent from 1.4 percent. The projection for 2019 was lowered to 1.4 percent from 1.5 percent.
The bank said the revisions to headline inflation notably reflect changes to the projections for oil prices, which have been revised upwards for 2017 then downwards for 2018 and 2019. In 2016, the economy expanded 1.1 percent and inflation was 0.3 percent. The forecast for core inflation, which excludes energy and food, was trimmed by 0.1 percentage points to 0.6 percent for this year, which is the same figure as in 2016. The core inflation outlook for next year was raised by a percentage point to 1.2 percent and upped slightly to 1.4 percent for 2019.
