In France, the budget deficit in 2024 is higher than expected. However, growth is up 0.4% in the 3rd quarter of 2024 while inflation is stagnating. On the other hand, job cuts continue with announcements of factory closures. However, the situation does not seem to concern the governor of the Bank of France who spoke about the situation.
Indeed, the governor of the Bank of France, François Villeroy de Galhau, spoke on the situation of the French economy this Wednesday, November 13. He felt that “the landscape is neither black nor uniformly pink.” François Villeroy de Galhau underlined that “the economy confirms a certain resilience month after month”.
The senior financial official, however, highlighted “strong uncertainties among entrepreneurs around the budgetary and tax debate in France, then now future American policy”. Concerning job cuts and factory closures in several sectors, the governor of the Bank of France did not express any particular concerns. However, he forecasts “a small increase in unemployment” due to the economic slowdown, to around 7.5% or 8%, before a decline “towards 7% (…) probably around the turning point of 2025-2026”. François Villeroy de Galhau recalled that the French economy had created some 2 million jobs over the past ten years.
Concerning the purchasing power of the French and the rise in prices, the governor of the Bank of France estimated that “inflation will remain moderate”. “This also means that prices are now growing less quickly than wages and that we, at the (European, Editor's note) Central Bank, will be able to lower interest rates,” he added. However, this decision will be up to the ECB Governing Council, which will meet on December 12.
The governor of the Bank of France calls on Europe to unite
François Villeroy de Galhau also took a position on the election of Donald Trump as President of the United States. He called on Europe to “get its act together” and stop “self-flagellation”. Otherwise, this official affirms that the EU could find itself “on the sidelines of the global economic match”.
In summary, the governor of the Bank of France, François Villeroy de Galhau, called on Europeans to unite after the election of Donald Trump. Regarding this European unity, it “was true before the election of Donald Trump, but it is even more true today,” he added. “We have assets in Europe. (… .) Europe must also come together” and “strengthen itself”, declares the official
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