France‘s GDP increased by 0.4% in the third quarter of 2024, boosted by economic activity linked to the Paris 2024 Olympic and Paralympic Games, new data from Insee has shown.
According to the statistics office, household purchasing power saw a positive shift in the third quarter, rising by 0.7%, compared to 0.4% in the previous quarter. It noted that this increase was driven in part by a decline in income taxes.
Household consumption
Household consumption grew by 0.6% in volume terms, compared to a stable performance in the second quarter, with the growth in consumption mainly driven by an increase in services, particularly related to the Olympics.
There was also a slight uptick in goods consumption, driven by an upturn in food consumption (+0.5%, compared to -1.6% the previous quarter) and an increase in purchases of textiles and clothing.
On the other hand, gross fixed capital formation (GFCF) continued to decline, falling by 0.7% due to a sharp drop in investments in manufactured goods, especially in transport equipment.
Exports and imports
Exports decreased by 0.8%, compared to a 0.6% increase in the previous quarter, while imports also fell by 0.6%, leading to a slight negative contribution from foreign trade to GDP growth. Inventory changes had a small positive impact, contributing 0.1 points to overall GDP growth.
The labour market showed stability, with total hours worked in the third quarter remaining unchanged from the previous quarter, and total employment growth remaining flat.
Lastly, the data showed that the profit-margin of companies outside the financial services sector – non-financial companies, or NFCs – reached 32.4% in the period, up by 1.2 points compared to 31.2% in the previous quarter.
‘The margin rate was boosted in the third quarter by the terms of trade, with the price of value added rising significantly faster than the price of household consumption, due in particular to the fall in the price of hydrocarbons and the rise in the price of electricity for exports,’ Insee said. ‘In addition, ticket sales for Olympic and Paralympic broadcasting rights generated productivity gains in the accounts this quarter.’ Read more here.
