Key facts
- The Bank of France estimated the economy will grow moderately in the fourth quarter, without giving a specific forecast.
- The central bank cited uncertainty over recent protests and unrest and international developments after the US midterm elections.
- Executives surveyed expected industrial output to accelerate in November, with activity rebounding in pharmaceuticals and autos.
- Manufacturing was supported by aerospace, defense-linked sectors and data-centre construction, while automakers continued to struggle.
- The survey pointed to a sharp rise in uncertainty, with firms citing political and budget uncertainty, social unrest and higher fuel prices.
- Companies said customers were delaying projects and investment decisions, reducing visibility on business prospects.
France is on course to avoid a recession in the final quarter of 2026, with business executives expecting activity to accelerate in November, the Bank of France said on November 9, 2026. The euro zone's second-biggest economy is set to grow moderately in the fourth quarter after contracting 0.1% in the previous three months, the central bank estimated in its monthly outlook. A technical recession is defined as two consecutive quarters of economic contraction.
The central bank stopped short of providing a specific growth forecast so early in the quarter, citing uncertainty over the economic impact of recent protests and unrest as well as international developments following the US midterm elections. France has seen a series of protests since September that began over underfunded schools but have since broadened as unions organized demonstrations over the cost of living, adding pressure on the minority government as it struggles to push spending cuts through France's deeply divided parliament.
The outlook was based on the central bank's monthly survey of 8,500 companies, in which business executives reported that activity picked up in October in both industry and services, while remaining broadly flat in construction. Manufacturing was supported by strong demand in aerospace and sectors linked to defense spending and data-centre construction, although automakers and several other industrial branches continued to struggle.
Companies surveyed said they expected industrial output to accelerate further in November, with activity rebounding in pharmaceuticals and autos and remaining buoyant in aerospace and technology-related industries. Services activity was also forecast to grow, though at a slower pace, while construction was expected to remain broadly stagnant as weak demand continued to weigh on the sector.
The survey pointed to a sharp rise in uncertainty, especially in construction and services. Firms cited political and budget uncertainty, social unrest and higher fuel prices as key concerns. They said customers were delaying projects and investment decisions, reducing visibility on business prospects in the months ahead.