During the second quarter of the year, the French economy experienced a slight slowdown compared to the previous quarter, due in part to higher prices and uncertainty in the international context, reaching a year-on-year growth rate of 4.01%. In addition, inflation accelerated compared to the first quarter of 2022 to a rate of 5.27%. Regarding the labor market, the unemployment rate returned to 4Q21 values, standing at 7.20%. However, according to the Bank of France, due to the slowdown in activity, this figure could increase slightly for 2022 and 2023. In addition, the euro continued its depreciation against the dollar towards parity, with an average exchange rate of 1.07 $/€.

Macroeconomic outlook report: France 2Q22

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Macroeconomic Overview

  • During the second quarter of 2022, the French economy slowed down compared to the previous quarter. The year-on-year change in GDP declined by 0.71 p.p. from 1Q22 to 4.01%.
  • Due to uncertainty about the duration of the Ukrainian crisis and inflation, the outlook for economic growth, although still positive, weakens, mainly in 2023.
  • On the side of the labour market, the unemployment rate slightly increased compared to 1Q22 up to 7.20%. In addition, during the second quarter, the employment growth rate decreased 0.75 p.p. compared to the previous quarter, down to a 3.71% rate.
  • During the second quarter of 2022, the euro depreciated against the US dollar when compared to the previous quarter. The average nominal exchange rate for the period was 1.07 $/€.
  • During 2Q22, the year-on-year growth of the Consumer Price Index rose 1.60 p.p. compared to 1Q22, presenting a rate of 5.27%.

For more information, access the Macroeconomic Outlook Report of France 2Q22.