ECB’s Villeroy: French 2021 Growth Forecast ‘Quite Conservative’

16 March 2021

By David Barwick – FRANKFURT (Econostream) – European Central Bank Governing Council member François Villeroy de Galhau said Tuesday that the latest estimate of French growth this year was ‘quite conservative’.

In an interview with French commercial radio network RTL, Villeroy, who heads the Bank of France, noted that the new projections of the French central bank called for the domestic economy to expand by 5.5%, a clear increase versus the December forecast of ‘around 5%’.

‘I would also like to point out that our forecast is quite conservative, in the sense that we have foreseen that the current restrictions will remain until about the middle of the year’, he said.

‘[T]here may also be some good surprises, but there are still many uncertainties’, he said. Confidence, especially consumer confidence, would recover with the lifting of the pandemic containment measures, and French consumers ‘have accumulated a lot of savings’, he said.

Although unemployment would not decline immediately, at the end of last year job losses were much less severe than expected, thanks to the country’s short-time working scheme, he said. However, the number of hours worked per employee decreased on account of the drop in economic activity, he said.