In 2023, consumer price inflation slowed to 4.9% in France after an unprecedented peak since the beginning of the century. However, the gap between French inflation and that of the eurozone is rapidly narrowing, ending an anomaly observed in recent years. Official projections anticipate a further slowdown in inflation by 2025, but major uncertainties remain regarding the evolution of wages, energy, and public policies. Growth forecasts remain cautious, fueling a technical debate about the strength of the expected recovery.
What is the state of inflation in France as we approach 2025?
The landscape is changing at a surprising speed. After two years where every receipt was dizzying, the price curve is taking a gentler turn in early 2025. Insee announces an inflation rate of 0.9% year-on-year in February: we are far from the sharp peak of 2022. Gradually, France is aligning with the target set by the European Central Bank, joining the trend of its eurozone neighbors.
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Some explanations are necessary to understand this new equilibrium:
- With a 14% decrease in the regulated electricity tariff starting in February 2025, household budgets are breathing for the first time in months.
- The surge in food prices is clearly slowing down: after two years of pressure, the increase is limited to 1.1% in the summer, compared to 1.4% in 2024.
- On the non-food goods side, there is even an average decline of 0.3%. Excluding fresh products, the increase is now capped at 0.6%, which timidly eases the pressure on the consumer basket.
But it would be premature to speak of general relief. Service prices continue to rise (+2.2% expected in autumn 2025) and tobacco continues its climb above 4%. These disparities create a shifting landscape, in which inflation in France in 2025 becomes a new benchmark, both for economic decision-makers and for every household trying to balance its accounts.
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What are the inflation and growth forecasts according to Insee and the Bank of France?
Experts display a clear caution. Insee forecasts 1.5% inflation around mid-2025, then 1.3% for the following year. At the same time, the Bank of France estimates that as long as energy and food remain controlled, the symbolic threshold of 2% is not on the agenda. Underlying inflation, driven notably by the dynamism of wages and services, is also circulating around 1.5%.
On the growth side, the pace remains timid. According to Insee, GDP would grow by 0.8% in 2025, slightly surpassed by the Bank of France’s forecast of 0.9%. The outlook does not appear explosive: in 2026, the rate crumbles to around 0.4%. However, some sectors are managing to thrive: aerospace is shining thanks to Airbus’s performance and the good health of exports; sales of transport equipment are also up by 13% during the summer of 2025. Conversely, household consumption is stalling, hindered by savings exceeding 18%, a sign of a confidence that is slow to return.
Employment reflects the same caution. Spring sees the creation of 50,000 new hires, but the momentum quickly fades. Between 2025 and 2026, the unemployment rate stabilizes between 7.5% and 7.8%. Nothing indicates, for now, that a breakthrough is imminent.
Economic challenges and prospects for French households and businesses
Individuals, being realistic, are adapting their behavior: the urgency for impulse purchases is gone. Many are postponing their projects, while savings remain perched at high levels, a sign of collective vigilance. Wages are not keeping pace to quickly reverse the trend, and purchasing power is experiencing a slight erosion of around 0.4%. Comparisons with EU neighbors accentuate this climate of waiting, if not impatience.
For professionals, some bright spots are emerging. The aerospace sector is fully benefiting from a favorable environment, tourism is timidly regaining strength, but these pockets of dynamism are not enough to drive the entire economy. Hiring remains selective, and investment projects are measured. This feeling of stagnation extends even to senior executives.
On the real estate front, there is a stir: in autumn 2024, the volume of building permits stabilizes, offering a glimmer of optimism for those hoping to buy. However, it will still be necessary to transform this timid restart into a sustainable recovery and to keep a vigilant eye on monetary policy decisions, especially from the United States, which can change the game on the Old Continent at any moment.
The French scenario for 2025 resembles a walk on the edge of a precipice: we progress cautiously, ready to deal with the unexpected. Every indicator is watched, every signal scrutinized. Volatility does not disappear; it changes its face. It is now up to France to write the next chapter with the vigilance of a tightrope walker.