During the third quarter of 2020, the year-on-year variation rate of the French GDP registered an important increase compared to the previous quarter, increasing up to a rate of -4.28%. This partial recovery was the result of the relaxation throughout the beginning of the quarter of some of the containment measures. Inflation recorded a y/y growth rate of 0.33% in the third quarter of 2020. Regarding the labor market, the unemployment rate increased up to 8.80% compared to the previous quarter, while the year-on-year employment variation rate reduced its downturn, and increased up to a rate of -0.98%. The euro appreciated against the dollar during 3Q20, and recorded an average exchange rate of 1.17 $/€.

 


Macroeconomic outlook report: France 3Q20

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Macroeconomic Overview

  • During the third quarter of 2020, French economic activity recorded a partial recovery. The year-on-year GDP variation rate increased by 14.63 p.p. compared to 2Q20, up to a growth rate of -4.28%.
  • This partial recovery was mainly due to the relaxation of some of the containment measures at the end of the second quarter of 2020 and the beginning of the third, which led to an upturn in economic activity. Nevertheless, at the end of the third quarter of 2020, this increase slowed down due to a second wave of contagions worldwide.
  • Regarding the labor market, the unemployment rate increased by 1.80 p.p. compared to 2Q20, up to a rate of 8.80%. On the other hand, the employment variation rate increased by 1.55 p.p. compared to the previous quarter, up to a rate of -0.98%.
  • During the third quarter of 2020, the euro appreciated against the US dollar compared to the previous quarter. The average nominal exchange rate for the period stood at 1.17 $/€.
  • Inflation levels remained subdued due to low energy prices and downward pressure from the appreciation of the euro. During the third quarter of 2020, the Consumer Price Index recorded an increase of 0.03 p.p. compared to the previous quarter, up to a rate of 0.33%.

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