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Bank of France's Villeroy sees inflation returning to 2% in 2027, 2028
Finance

Bank of France's Villeroy sees inflation returning to 2% in 2027, 2028

Published by Global Banking & Finance Review

Posted on May 4, 2026

1 min read

· Last updated: May 4, 2026

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Bank of France Governor Predicts Inflation Return to 2% by 2027-2028

Bank of France Governor's Inflation Forecast and Economic Outlook

Inflation Rate Projections

PARIS, May 4 (Reuters) - Bank of France Governor Francois Villeroy de Galhau said on Monday he expected the inflation rate to return to 2% in 2027-2028 after a spike this year triggered by higher energy prices caused by "an unprecendent shock".

Short-Term Surge in Inflation

"We will first have a surge in inflation in 2026 this year, so inflation according to the scenarios would be between a little less than 2% on average annually or more than 3%," he said in an interview on BFM TV station. "But inflation would return to the target of 2%."

Economic Growth Expectations

Recession Avoidance and Growth Scenarios

He added the bank expected France to avoid recession this year, with economic growth of between 0.3% and 0.9% "in the most optimistic scenario".

Reporting Credits

(Reporting by Sudip Kar-Gupta and Inti Landauro; Editing by Alex Richardson)

Key Takeaways

  • Inflation is expected to surge in 2026—averaging roughly 1.7% in the baseline, but possibly over 3% under severe energy‑price shock scenarios. (banque-france.fr)
  • In 2027 and 2028, inflation is projected to decline toward the 2% target, aligning with Villeroy’s medium‑term price stability commitment. (banque-france.fr)
  • The Bank expects to avoid recession, forecasting 2026 growth between 0.3% and 0.9%, with a recovery in 2027–2028 supported by consumption, investment and exports. (banque-france.fr)

References

Frequently Asked Questions

What inflation rate does the Bank of France expect for 2027-2028?
The Bank of France expects the inflation rate to return to the 2% target in 2027-2028.
What has caused the surge in inflation in France this year?
A spike in energy prices, described as an 'unprecedented shock' by the Bank of France Governor, has driven inflation higher this year.
What is the projected range for France's economic growth this year?
The Bank of France expects economic growth in France to range between 0.3% and 0.9% in 2024.
Does the Bank of France expect a recession in France this year?
No, the Bank of France expects France to avoid a recession in 2024.

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