September 25, 2017 / 7:20 AM / a year ago

Bank of France raises 2017 French economic growth forecast to 1.7 percent

PARIS (Reuters) - The head of the Bank of France said on Monday that the country’s economic growth could reach 1.7 percent for 2017, up from previous estimates and bringing it into line with other, similar official forecasts.

FILE PHOTO: French Central bank Governor Francois Villeroy de Galhau attends the 2016 Institute of International Finance (IIF) Spring Membership meeting in Madrid, Spain, May 25, 2016. REUTERS/Susana Vera/File Photo

Bank of France governor Francois Villeroy de Galhau made the forecast in an interview published on Monday in regional newspaper Midi Libre, in which he highlighted the importance of economic reforms for the country.

The 1.7 percent forecast compared to an estimate of 1.6 percent growth given in July and 1.4 percent in June.

“The economic recovery cannot be doubted. It is happening throughout Europe, including France. However, in our country, growth is not yet strong enough,” said Villeroy de Galhau.

“This year, it could reach 1.7 percent. That would still put it below the average for the euro zone, which stands at over 2 percent. This underperformance highlights one imperative - we must take advantage of the recovery to step up reforms in France, so that we can bring up our growth level to that of our European neighbours, who have succeeded in this area,” he added.

The updated forecast from the head of the Bank of France brings it into line with similar estimates on French economic growth for 2017 from the government, while the OECD this month also moved up its forecast for France’s 2017 economic growth to 1.7 percent from 1.3 percent previously.

Last week, the International Monetary Fund (IMF) said Macron’s success in overhauling the economy would hinge on reining in government spending, the highest among developed countries at over 56 percent of gross domestic product.

Reporting by Sudip Kar-Gupta; Editing by Leigh Thomas

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