French growth picks up, boosting hopes eurozone technical recession is over – business live

We haev encouraging economic news from Germany too, where consumer spending has risen faster than expected.

German retail sales grew by 1.8% in March, beating forecasts of 1.1% growth, and largely reversing the 1.9% drop recorded in February.

The broader picture is that France’s economy has only grown modestly over the last nine months.

The 0.2% rise in GDP in January-March reported this morning follows two quarters of 0.1% growth.

Newsflash: France’s economic growth has accelerated in the first quarter of this year, beating expectations.

In an encouraging start to eurozone GDP day, French GDP expanded by 0.2% in January-March, a pick-up on the 0.1% growth recorded in October-December.

Economists expected growth of 0.1%, so this may bolster hopes that the eurozone has returned to growth.

Household spending helped drive the French economy, statistics body INSEE says, with final domestic demand bouncing back and contributing 0.4 percentage points to growth.

But foreign trade’s contribution to GDP growth fell to zero, with imports rising by 0.2% and exports up by 0.5%.

There’s big news in the banking sector this morning: HSBC’s chief executive officer Noel Quinn is unexpectedly stepping down after nearly 5 years in the job.

The board has begun a formal process to find a successor, firing the starting gun to find a replacement at Europe’s largest bank.

Quinn is stepping back after leading a series of strategic reviews, boosting HSBC’s investment in its Asian business while cutting back on other markets such as France and the US.

Looking ahead, Quinn explains why he’s stepping down:

“After an intense five years, it is now the right time for me to get a better balance between my personal and business life. I intend to pursue a portfolio career going forward.”

Quinn was appointed CEO in March 2020, after a stint as interim chief executive, and steered the bank through the Covid-19 pandemic.

There’s good news for UK shoppers this morning – prices are rising at their slowest rate since late 2021 this month, with non-food goods actually cheaper than a year ago.

Deep discounts by clothing and footwear retailers put the brakes on inflation, the latest snapshot of high street spending trends has shown.

The monthly bulletin from the British Retail Consortium (BRC) – the lobby group for the industry – found that the battle by store owners to offload summer stock in cold and wet weather meant prices in non-food stores were lower this month than a year earlier.

The BRC said the cost of non-food goods fell at an annual rate of 0.6% in April, while the price of food increased by 3.4%, down from 3.7% in March. Taken together, food and non-food inflation stood at 0.8% in April, compared to 1.3% in the year to March – the lowest level since December 2021.

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We already have some idea how the eurozone fared in the first quarter of this year, as Ireland and Belgium both released growth data yesterday.

Ireland’s GDP rose by an impressive-sounding 1.1%. in January-March, led by a rebound in its tech sector.

That means Ireland’s technical recession has ended, after its GDP shrank through 2023, including a 3.4% contraction in October-December 2023.

GDP isn’t a great way of measuring Ireland’s economy, though, as the data is distorted by multinational companies based in the Republic.

Belgium’s data was altogether calmer – its GDP expanded by 0.3% in January-March, for the fourth quarter in a row.

Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

The eurozone economy is in the spotlight today with new growth figures, and inflation data, being released across the single currency bloc.

Having been held back by high interest rates, and the cost of living squeeze, economists are hoping the eurozone returned to growth in the first quarter of this year.

Analysts predict that eurozone GDP grew by 0.1% in January-March quarter. That would pull the region out of a shallow recession, after it contracted by 0.1% in the third and fourth quarters of last year.

Analysts at Investec are hopeful that we’ll see some growth in the eurozone:

Focus will also be on the inflation outlook in the Eurozone, with flash HICP for April due on Tuesday. This will be released at the same time as Q1 GDP. Recent revisions now mean that the Eurozone was in a technical recession in H2, albeit by the slimmest of margins.

Given that economic data at the start of 2024 has been more positive, we expect the Eurozone exited that recession in Q1, with a 0.1% quarterly expansion in output.

Inflation is expected to remain unchanged at 2.4% in April, while core inflation could slip to 2.6% from 2.9%.

Easing inflationary pressures could leave the European Central Bank free to start cutting interest rates in June – especially if growth were to disappoint…

Also coming up today

Frankly, it could be a monster day for news.

For starters, new post-Brexit charges on imports of EU food and plant products into Britain begin today. Fees of up to £145 will apply to small imports of animal products and plants, such as sausages, cheese and yoghurt, entering the UK from the EU through the port of Dover and through Eurotunnel at Folkestone.

A flurry of big name companies are reporting financial results today; we’ll hear from Whitbread, Glencore, Prudential, St James’s Place and Howdens, while HSBC has just reported a small (1.5%) dip in profits for the last quarter, to $12.7bn.

Over in Europe, Mercedes-Benz, Volkswagen, Adidas and Lufthansa are reporting, while on Wall Street McDonalds, Coca-Cola and Amazon will update the markets.

Mining giant Anglo American is holding its annual general meeting, days after fending off a takeover proposal from rival BHP Group, who are now considering whether to improve their offer…

And in parliament, MPs on the Treasury committee are holding an inquiry into financial sanctions on Russia this morning, while the Environment, Food and Rural Affairs Committee will question supermarket bosses about food price inflation, profits and relationships with producers this afternoon.

The agenda

• 6.30am BST: French GDP for Q1 2024

• 7am BST: German retail sales for March

• 7.30am BST: Hungarian GDP for Q1 2024

• 7.45am BST: French inflation report for April

• 8am BST: Austria’s GDP report for Q1 2024

• 8am BST: Czech Republic GDP report for Q1 2024

• 8am BST: Spain’s GDP report for Q1 2024

• 9am BST: Germany’s GDP report for Q1 2024

• 9am BST: Italy’s GDP report for Q1 2024

• 9.30am BST: Portugal’s GDP report for Q1 2024

• 9.30am BST: UK mortgage approvals and consumer credit data for March

• 10am BST: Eurozone GDP report for Q1 2024

• 10am BST: Eurozone inflation report for April

• 10.15am BST: UK Treasury committee holds opening session of inquiry into Russian financial sanctions

• 1pm BST: Mexico’s GDP report for Q1 2024

• 1.30pm BST: Canada’s GDP report for February

• 2pm BST: US house price index for February

• 2.30pm BST: Supermarket bosses appear at a Efra select committee hearing on food supply chains