Free Trial

ECB’s Villeroy: French Economy Performing Well, “At Least Better Than Feared”

27 November 2025

ECB’s Villeroy: French Economy Performing Well, “At Least Better Than Feared”
François Villeroy de Galhau, governor of the Banque de France, at the European Central Bank Forum on Central Banking in Sintra on July 2, 2024. Photo by the ECB under CC BY-NC-ND 2.0.

By Marta Vilar – MADRID (Econostream) – European Central Bank Governing Council member François Villeroy de Galhau said on Thursday that the French economy was doing better than expected and that fiscal consolidation would, contrary to common belief, have a positive impact.

In an interview with French radio France Info, Villeroy, who heads the Banque de France, said that the failure of French lawmakers to reach agreement on the social security budget the previous day was “not the end of the budget debate,” but rather “an additional bump on a path that is already tortuous.”

He called the budget discussions so far “worrying and divided” and said he hoped compromises could still be reached, urging politicians to move beyond a short term mindset.

Asked about the economic consequences, Villeroy stressed that the French economy was “holding up fairly well, or at least better than feared.” He pointed to the Banque de France’s 2025 growth forecast of 0.7%, describing it as “still positive.”

Fiscal consolidation, he argued, would not weaken the economy but instead support it by strengthening confidence in France.

“Currently, the French have a very high savings rate, and this weighs on consumption and therefore on growth,” he said.

 

Related articles: