The Banque de France reported weaker-than-expected third-quarter growth.

According to the most recent economic survey that was released by the Banque de France on Monday, “Overall, during the quarter which just concluded in September, the activity would have resisted pretty well.”

According to the most recent business survey conducted by the Banque de France and published on Monday, gross domestic product (GDP) growth in France for the third quarter is anticipated to come in at 0.25%, which is slightly lower than the forecast (0.3%) made at the beginning of September. “The letter also states that “Early signs indicate a small increase in GDP in October.” “Olivier Garnier, the director general of the Banque de France, stated that this “confirms the solid resilience of activity in the third quarter and confirms our 2022 estimates (2.6%, editor's note)”.

According to the survey, growth in September was “stable” in comparison to August, despite a minor increase in activity in construction in comparison to industry and services. “According to the Bank of France, “overall, during the three months that recently concluded in September, activity seems to have kept up quite well, pushed by the vitality of certain market services, but also by a rise in value added in the industry during the summer.”

A scenario characterized as “very uncertain”

“In an environment where there is a great deal of unpredictability, most notably about the price and availability of energy,” them “According to the investigation's findings, businesses' expectations for October are that activity will not change significantly in the fields of industry and construction and will once again rise in the field of market services, albeit to a lesser extent than in the months prior.

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The central bank also notes that prices of finished products have started to rise again due to a strong seasonal catch-up after the summer and uncertainties linked to the energy crisis, which are both factors that have contributed to the rise in prices “according to Olivier Garnier's statements, “extend to all sectors.”

“In the manufacturing industry, 29% of business executives surveyed said that they increased their selling price in September. This number is especially high in the chemical industry, the printing industry, the wood industry, and the paper and printing industry. In the agro-food industry, 43 percent of businesses have reported that they have raised their prices. According to the paper, “It jumps to 49% for enterprises that are in the construction industry and 21% for market services.”

The increases, which are expected to slow down slightly in October in the industry (23%), services (20%), and construction (44%), pertain mostly to services directed toward individuals (accommodation, catering, auto maintenance), as well as transportation.

Moving away from the supply problems continues to be a challenge “according to Olivier Garnier, “April peak,” yet unemployment rates continue to be high (49% in industry and 40% in construction). When it comes to cash flow, the industry as a whole, including both large and small businesses, continues to struggle as a result of the high cost of raw materials and energy. “According to the Bank of France once more, “this degradation particularly impacts some industrial sectors such as the pharmaceutical industry, chemicals, wood, paper, printing, and electrical equipment.”

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