While the economies of its main European neighbours continue to grow, France is standing out as an exception. After a start to the year marked by a 0.2% fall in GDP in the first quarter, followed by flat activity in the second, the French economy is "losing ground", Insee warns. The statistics office, which had until now been forecasting 0.7% GDP growth, has sharply revised down its growth outlook for 2026, now capped at 0.4%.
The situation contrasts with that of the main neighbouring economies. Over the first two quarters, Germany recorded growth of 0.4% and then 0.3%, Italy 0.3% and then 0.2%, and Spain 0.6% and then 0.7%. The United Kingdom, for its part, grew by 0.6% and then 0.4%.
The engines of the French economy "stalled"
According to Insee, "all the engines of domestic demand" are "stalled". Household consumption remains weak and investment is falling, weighed down by a slowdown in public projects linked to the municipal electoral cycle.
The institute also points to the impact of heatwaves, particularly severe for agriculture, as well as a labour market "in a worse state than elsewhere in Europe", marked by rising unemployment and sluggish wages.
