PARIS (Reuters) – The French economy is set to return to growth in the first quarter as service sector activity rebounds, the central bank said on Tuesday in its monthly outlook.
The euro zone’s second-biggest economy is on course to grow 0.1-0.2% in the first quarter from the previous three months, when France saw a 0.1% contraction in activity, the Bank of France said.
While services would drive first quarter growth, manufacturing was expected to be flat after having contracted in the previous quarter.
Companies reported an increase in business uncertainty, citing the turbulent domestic political situation and fears about potential U.S. tariffs rise, according to the central bank’s monthly survey of business sentiment at 8,500 firms.
Companies raised their prices less in January than they have at the start of the previous three years while staffing difficulties continued to ease across the private sector, the survey found.
(Reporting by Leigh Thomas; editing by Mark Heinrich)
