France Records Zero Growth as Inflation Rises to 2.7%

France’s economy entered the third quarter from a weaker position than initially expected. Final data from national statistics office INSEE showed that gross domestic product did not grow in the second quarter of 2026, revising down an earlier estimate of 0.2% growth.

The result also fell short of the average 0.2% expansion forecast by 23 economists surveyed by Reuters. The stagnation came despite gains in two important parts of the economy.

Exports increased 2.9% in the second quarter, recovering from a 3% decline in the first three months of the year. INSEE attributed the improvement mainly to a strong rebound in aerospace exports. Household consumption also recovered, rising 0.3% after falling by the same amount in the first quarter. Consumers spent more on food, energy and manufactured goods.

Those improvements did not lift overall output into positive territory. At the same time, preliminary INSEE figures showed renewed price pressure in August. Harmonized inflation, calculated under a common European method for comparisons across eurozone countries, rose to 2.7% from 2.4% in July.

INSEE attributed the 0.3 percentage-point acceleration to higher energy prices, particularly petroleum products. The combination of revised stagnation and rising inflation leaves France with a more difficult starting point for the third quarter, despite the recovery in household spending.