Rain on his parade – then François Hollande flies into a storm

France's new President, François Hollande, stepped up his demands for a European growth plan during his first meeting with Chancellor Angela Merkel last night, insisting that a switch away from austerity was essential to help Greece remain in the eurozone.

Speaking at a joint press conference in Berlin following talks held only hours after Mr Hollande's rain-swept inauguration, the two leaders stressed their commitment to supporting Greece.

But whereas Chancellor Angela Merkel proclaimed that both France and Germany were committed to doing their utmost to prevent Greece from abandoning the euro, Mr Hollande insisted Europe's answer to Athens had to be growth. "We need to say to Greece that Europe is ready to support growth," he said. "We have to show growth is not only a word but something which is followed by tangible acts."

The two leaders announced an emergency Franco-German summit on the euro crisis next Wednesday. Mr Hollande said "all options" would be discussed. Ms Merkel has flatly refused to concede to Mr Hollande's demands that the fiscal pact be renegotiated to incorporate growth elements. However, she has conceded that an additional agreement which would encourage growth could follow the pact.

The Chancellor said last night's first meeting enabled the two leaders to get to know each other and that, despite their different views on Europe, she looked forward to working together with Mr Hollande.

The President was keen to blaze a "new trail" towards growth in Europe after his rain-soaked inauguration. At his request, the ceremony in Paris was more modest and less formal than usual. He gave an upbeat, but realistic, inaugural speech in which he promised to restore "confidence" in France and Europe but recognised the "weight of the constraints" facing his five years in the Elysée Palace. Despite "massive debt, weak growth and degraded competitiveness", he said, France and Europe could overcome the crisis.

"To surmount the crisis, Europe needs [infrastructure] projects, it needs solidarity and it needs growth," he said.

Earlier, Mr Hollande had been greeted on a red carpet laid in the courtyard of the Elysée Palace by the man that he defeated in the presidential election 10 days ago. Nicolas Sarkozy could scarcely disguise his dismay at giving way to a man that he once described as a "nothing". After a brief handshake Mr Sarkozy turned away, shoulders slumped. He led his Socialist rival into the presidential palace for a 40-minute handover meeting, including the transfer of the codes which control the French nuclear deterrent.

In a first in French presidential history, the outgoing and incoming First Ladies met over coffee. Relations between Carla Bruni-Sarkozy and Mr Hollande's partner, Valérie Trierweiler, appeared to be much friendlier than relations between their partners. The two women kissed in front of the cameras. The ex-President and his wife then walked hand-in-hand to a limousine and drove away to cheers from Mr Sarkozy's staff and supporters.

In his 20-minute inaugural speech, he repeated his promise to abandon the glittering, frantic and often self-regarding presidential style of the Sarkozy years. The new President said that he would govern with "dignity and simplicity". He also promised to return to the traditional pattern of French government in which daily affairs are handled by the Prime Minister while the President plays a guiding role.

"I will set the priorities," he said. "But I will not decide everything, for everyone and everywhere."

Towards the end of his speech, Mr Hollande paid a brief tribute to five of his six predecessors. Of the sixth, President Sarkozy, he simply said that he "wished him well" in the "new life that is beginning".

Mr Sarkozy had invited 200 friends and family members to his inauguration in 2007. President Hollande, as part of his desire for a more modest ceremony, invited 30 friends and colleagues but no members of his family.

Other guests included political, military and religious dignitaries, senior cultural figures and Mazarine Pingeot, 38, the illegitimate daughter of late President Francois Mitterrand. After the ceremony, Mr Hollande rode up the Champs Elysées to the Arc de Triomphe, standing, as tradition demands, in an open-roofed car. The heavens opened, soaking his smart blue suit and the feathered helmets and uniforms of his Republican Guard escort.

After placing a wreath on the Tomb of the Unknown Soldier, a wringing-wet President Hollande took the time to talk to each veteran in the parade. He then walked across to the crowds at the top of the Champs Elysées to shake hands with well-wishers.

Later, when leaving a lunch at the Elysée Palace, Mr Hollande stopped his limousine and spent a few minutes shaking hands and exchanging kisses with members of the public.

He has promised that, as far as possible, he will not allow himself to be cocooned by the flummery and protocol of the presidency.

President's man Ayrault to be PM

Unlike Nicolas Sarkozy, François Hollande has no plans to become his own de facto Prime Minister. Instead, by naming Jean-Marc Ayrault to the post yesterday, he chose his political "twin".

Mr Ayrault, 62, is also a calm, consensual, uncharismatic politician who has never held ministerial office. He was leader of the Socialist group in the last National Assembly and has been mayor of Nantes since 1989. Mr Ayrault is from a working-class background and is a former German teacher who knows Germany, and its politicians, well.

The rest of the government will be named today. Left-wing firebrand Martine Aubry is expected to receive a large ministry, possibly education; Michel Sapin is tipped for Finance Minister; and former Europe Minister, Pierre Moscovici, is likely to become Foreign Minister.

John Lichfield