Economic forecasts on French economy 2008
- Economic context
- World economy
- Domestic environment
- The real economy
- The interest rate, wages, prices and unemployment
- Capacity utilization
- Household's confidence evolution
- French consumer prices by sector (INSEE, April 2008)
- Alternative forecast: BNP
Today, France stands at one of its lowest confidence rate since a decade. On a global scale, world trade contracted in 2007 with only 5.5% growth compared to 8.5% in 2006. The sub primes crisis is directly hitting the global financial markets and disturbing the world economy. If we have a glance at consumer prices and oil and raw materials prices, concerns are high. In this gloomy atmosphere, our report aims at analyzing the different forecasts for 2008 French Economy.
We will explain the various impacts of the international context on the French Economy. We will also lay the stress on the different mechanisms that affects consumption, investment and more generally the GDP growth. Our dossier puts mainly the emphasis on data from INSEE and BNP. Finally, we think that institutes may have had some hardships to evaluate the weight of financial crisis and incentive French Government policies of last 2007 in the mid- term.
[...] Household's confidence evolution Source: INSEE (since acity roblems Source: INSEE The first results of 2008 confirm the forecasts made by the BNP and INSEE. In the early 2008 the capacity utilization rate seems to be close to However, the first figures for 2008, ( 86.1 in January and 85.2 in April) lead to anticipate a possible decline in capacity utilization rate due mainly to moderate demand and lighter investment. Prices, wage rate, interest rate interest rate) Inflation rate (April 2008) French Consumer prices by sector (INSEE, April 2008) mars fév. [...]
[...] It is currently trying to reduce the inflation whereas overseas, the FED aims at reactivating the American economy Alternative forecast: BNP We suggest you a ranking of the BNP and INSEE according to our analysis and our perception of evolutions BNP Forecasts INSEE Forecasts Unemployment rate + Rate of capacity + + utilisation Inflation rate + Wage growth ~ ~ Source: INSEE According to the five elements you have studies, we have a preference for the BNP forecasts which seem to us to take into account more the new emerging context except on the interest rate. [...]
[...] Besides, the rate of use of production capacities is about which means that this use can be increased before investment. Special factors During the last quarter of 2007, France already knew a wave of strikes of the transport which would have cost 0.1 point of growth in real GDP to the country. Indeed, such strikes paralyze all the workers who depend on the transport network, and thus affect the whole economy. The strikes of the beginning of 2008 did not affect transports, so, their effect on the growth is lesser. [...]