French Central Bank Revises 2025 GDP Outlook Down to 0.7%

France revised its GDP growth forecast for 2025 to 0.7%, down from 0.9% previously, and a decrease from the 1.1% growth seen last year, the central bank said on Wednesday in its quarterly outlook.

The revision comes as trade tensions have affected demand for French exports.

The central bank estimated that the economic uncertainty caused by various tariff threats from U.S. President Donald Trump shaved 0.1 percentage points off the outlook for this year.

Meanwhile, the economy is expected to grow by 1.2% in 2026, down from a previous forecast of 1.3%, mainly driven by an improvement in business investment.

For 2027, GDP is expected to grow by 1.3% (unchanged).

Additionally, inflation is projected to average only 1.3% this year, down from an estimate in December of 1.6%, calculated using an EU-wide harmonized method.

The central bank added that inflation would be weaker than expected due to lower regulated electricity prices, softer service prices, and slower wage growth.