Bank of France Governor François Villeroy de Galhau has increased the bank’s growth outlook for 2025 and 2026 while outlining fiscal targets to avoid a deficit above 5 % of GDP. He attributes resilience to entrepreneurial commitment and a more favorable international context, though he cautions that political uncertainty dampens spending. The governor says the next budget will target a deficit of 5.3 % of GDP, unchanged from 2025, and that a 4.8 % target is needed for 2026 to stay below the 5 % threshold. He stresses the need to bring the deficit to 3 % by 2029 to stabilise debt‑to‑GDP, warning that higher interest payments would erode spending on education, security and digital. He notes that Chinese imports into Europe rose 11 % in volume and fell 9 % in price, and that the ECB will keep rates unchanged, highlighting the need for a digital euro and greater flexibility in public spending rather than tax cuts.
© Banque de France 2025.
Summary adapted from material on the Banque de France website (https://www.banque‑france.fr ).
https://www.banque-france.fr/en/governors-interventions/le-figaro-deficit-above-5-would-put-france-risk
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