Key facts
- France's economy registered 0.0% growth in the second quarter.
- Exports rebounded by 2.9% in Q2, driven by aeronautics.
- Household consumption increased by 0.3% in Q2.
- French inflation accelerated to 2.7% year-on-year in August.
- The government lowered its 2026 growth forecast to 0.7%.
France's economy registered zero growth in the second quarter, according to final data from INSEE, falling short of preliminary estimates and economist forecasts. Despite the stagnation, exports rebounded by 2.9%, boosted by the aeronautics sector, and household consumption rose 0.3%, driven by increased spending on food, energy, and manufactured goods. This followed a 0.1% contraction in the first quarter. Preliminary data also showed that French harmonized inflation accelerated to 2.7% year-on-year in August, up from 2.4% in July, primarily due to higher energy prices. The French government has consequently lowered its full-year growth forecast for 2026 to 0.7% from 0.9%. External factors such as the conflict in the Middle East, US tariffs, and recent wildfires continue to create uncertainty, impacting the broader eurozone where the European Central Bank recently held its key interest rate at 2.25%.