The Bank of France will lower its 2026 growth forecasts in mid-June due to the war in the Middle East.

"There will be several scenarios but the 2026 growth forecasts will, given this bad surprise in the first quarter, be revised downwards compared to the one we published in March," which was 0,9%, Mr. Villeroy de Galhau said on Radio Classique.

These forecasts "will remain positive in most scenarios," the governor stressed, refusing to talk "today" about a recession, meaning two consecutive quarters of GDP decline.

He nevertheless noted that there remained "a lot of uncertainty about the duration of the conflict in the Middle East, about what will happen to the price of oil".

"When we look at the details, it's a slowdown not only in exports, which is spectacular, but also in what we call domestic demand," that is, "household consumption, household investment and business investment," explained Mr. Villeroy de Galhau, who will leave his position by the end of the month.

In May, the International Monetary Fund (IMF) lowered its growth forecast for France in 2026, from 0,9% to 0,7%.

The French government slightly lowered its growth forecast in mid-April to 0,9% in 2026, compared to 1% previously.

A revision of this forecast is not planned at this stage, Bercy declared last week, before the Insee publication.

Illustrative image of the article via Depositphotos.com.