France's Economy Surges: Business Activity Rebounds Sharply

France's economic growth has accelerated at the beginning of the year, driven by a stronger-than-anticipated rebound in business activity. The Bank of France estimates the euro zone's second-largest economy will grow between 0.2% and 0.3% in the current quarter, following a 0.2% expansion in the previous period.

Companies across industry, services, and construction reported enhanced confidence entering February. Industrial output, particularly in defense and aerospace-related sectors like electronics and machinery, has extended its strong performance. Services and construction sectors also saw advancements that surpassed initial firm expectations.

Looking ahead, businesses anticipate continued growth in February, with industry expected to expand robustly and services and construction showing more moderate gains. While overall uncertainty has slightly decreased, it remains elevated in industry due to trade tensions. Supply chain pressures have worsened in aerospace and electronics, and recruitment challenges are intensifying, especially in construction.