For the form, the Ministry of economy and finance requested economic institutes to send, Friday, September 15, their latest growth forecasts for next year, in France and in the euro area. Most are delivered in a timely manner, without many illusions about the use which will be made, a few days of the presentation of the 2007 budget. As Bercy was not expected to consult private economists to its forecast of growth in a range from 2 to 2.5, identical to that of the 2006 budget. The rest, Thierry Breton, Minister of economy and finance, meet the Economic Commission of the nation as early October, once unveiled the Finance Bill.
Considered pessimistic by the Minister, who criticized them not sharing its voluntarism, economists will not contradict again, their reputation. Posted Friday, September the "Consensus Forecasts", based on the 2007 20 institutes of economic growth forecasts, spring at 2. It is very slightly better than what was expected. In the light of good activity in the second quarter figures, all experts have identified their estimate of growth for 2006, the average point now to 2.3. This partly explains the 2007 consensus to reach just the 2 threshold. "We end the year strong enough and this positive dynamic is felt at the beginning of the next," says one of them.
Uncertainty about the Germany
Especially, the dominant opinion is now that the negative effects of the increase of VAT in Germany of three points, January 1, will be less severe than expected. The "Consensus Forecasts" does, admittedly, only 1.2 growth German next year, but this is better than what was envisaged previously. "German companies will take their dependants on their margin, part of the increase in VAT," analyzes a Bank economist. The French economy would, thus, less affected by fiscal measures of the Germany, our first partner. The strength of the French household consumption and the resumption of investment in the second quarter lead in any case some expected 2.3 growth for the France, such as the international monetary fund. "The internal mechanics of growth is strong enough to allow us to go through the global downturn," said Xavier Timbeau, Director of analysis and prediction of the OFCE Institute which provides "around 2.2-2,3 " growth in 2007.
Fragile engines
This assumes that the deceleration of the US economy is carried out smoothly, a hypothesis not be shared. In support of its forecast of 2 growth for the France next year, BNP Paribas emphasised in particular that exist for the United States, "significantly less than 2 growth prospects." In this context, some are not expensive resistance of internal engines of French growth. Economic institutes (Ixis CIB, Natexis Banques Populaires, Société Générale...) expect no more than 1.8 growth next year. "The resumption of investment is very fragile, so it is not investment capacity, observes Marc Touati of Natexis Economist.". Households, they not forever able to tap into their savings to consume. "Only consolation, but it is thin: whatever the case, experts are unanimous in considering that the France will be better in 2007, the average of the euro (1.8).
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