French growth crashes to zero in first quarter

The French economy flatlined in the first quarter as households reduced their consumption due to rising inflation and the war in Ukraine, the national statistics agency said Friday.

The zero-growth result was weaker than the INSEE agency's pre-war forecast of a 0.3 per cent expansion, underlying the economic difficulties faced across Europe.

The French annual inflation rate also accelerated to 4.8 per cent in April, up from 4.5 per cent the month before, INSEE said in a separate statement.

"Gross domestic product is at a standstill ... it bears the mark of the two combined external shocks (Covid and the Omicron variant in January, then the war in Ukraine that strengthened inflation)," INSEE economist Julien Pouget wrote on Twitter.

The figure puts an end to France's strong economic rebound from the Covid-19 pandemic and poses a challenge to President Emmanuel Macron, who was re-elected last weekend.

Economic growth had been clocked at 0.8 per cent in the last quarter of 2021 and 3 per cent in the third. European economies have been badly affected this year by supply problems linked first to the pandemic, then the war in Ukraine -- as well as sanctions imposed on Russia following its February 24 invasion of its neighbour.

Figures also released Friday showed that the eurozone's GDP growth slowed to 0.2 per cent in the first quarter, with a Germany eking out a similar gain as it avoided a second consecutive quarterly contraction.