France lowers economic growth forecasts on trade tensions

French Finance Minister Eric Lombard lowered the country’s economic growth forecast for 2025 amid escalating global trade tensions. However, he said the government would stick to its plans of reducing the budget deficit.

France’s GDP is now expected to grow by 0.7% instead of previously forecasted 0.9%. However, Lombard claimed that the authorities are focused on reducing the budget deficit to 5.4% from 5.8% last year.

Additionally, if US import tariffs remain at the levels announced by Donald Trump, they will have a moderate impact on France, Lombard said.

French Budget Minister Amelie de Montchalin informed that the government was freezing 5 billion euros ($5.49 billion) in savings in order to reach the public sector deficit target. But Lombard dismissed any significant tax increases or spending cuts. This could lead to slightly lower targets if trade tensions put more pressure on the country's public finances, Reuters said.