French GDP Slips 0.1% in First Quarter, Raising Spectre of Recession
Consumer spending fell 0.2% and inflation rose to 2.4%, increasing pressure on growth and raising the risk of a technical recession, economists said.
- On Friday, official data showed French GDP shrank 0.1 percent in the first quarter, a downward revision that analysts warn could herald a recession for France, the eurozone's second-biggest economy.
- Consumer spending fell 0.2 percent as surging fuel prices from the Iran war throttled Gulf oil and gas shipments, reversing growth from the fourth quarter of last year.
- Statistics office INSEE reported construction spending fell 1.7 percent. Dorian Roucher, the agency's head of forecasting, called the decline 'an unpleasant surprise,' noting 'very bad figures for home renovations.'
- Economy Minister Roland Lescure said the government 'remained vigilant, but without giving in to fear-mongering,' attributing growth weakness to 'cyclical headwinds and the late adoption of the government budget.'
- Analysts at ING noted that 'households are becoming more pessimistic about their financial situation,' forecasting GDP expansion of around 0.6 percent and warning the government's growth target 'appears clearly out of reach.
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With GDP falling in the first quarter and inflation accelerating to 2.4% in May, the threat of a recession is hovering on the French economy. In an attempt to contain the deficit, Bercy always relies on budget management "to the nearest euro".
In its first estimate, INSEE had announced zero tricolor growth between January and March.
France’s Economy Flatlines Amid Export Slump, Weak Spending
France’s economy flattened in the first three months of 2026, amid falling exports, weaker household spending, and a slowdown in construction. French statistics agency INSEE reported on May 29 that gross domestic product (GDP) stalled in the first quarter, following growth of 0.2 percent in the final quarter of 2025. The figures suggest Europe’s second-largest economy entered the year with little momentum amid a difficult international environme…
DEXYPTAGE - L的Insee indicates that GDP has finally declined by 0.1% in the first quarter, a first since the Covid crisis.
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rd.nlFrance is facing weak domestic demand and a decline in exports, with the economy shrinking by 0.1 percent in the first quarter.
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