France’s economy is not facing a catastrophe, but the government must take action to reduce its public deficit, central bank chief Emmanuel Moulin said on Friday.
Speaking to RTL radio, Moulin was responding to a fresh downgrade to France’s growth outlook by the national statistics institute, INSEE. The economy is now expected to expand by just 0.4 per cent in 2026, down from an earlier forecast of 0.7 per cent.
INSEE said the weaker outlook reflected several factors, including the impact of a severe heatwave. Moulin also pointed to difficulties affecting Airbus, one of France’s most important industrial groups.
The revised forecast would leave growth well below the 0.9 per cent recorded last year. The French government is expected to lower its own 2026 growth estimate from 0.7 per cent as it prepares its 2027 budget plans.
Ministers are due to submit the budget bill to parliament at the end of September, with pressure mounting to set out credible measures to bring down France’s deficit and contain rising public debt.
