(Jan 30): France’s economy kept growing at the end of last year as households shrugged off political upheaval and the risk of austerity.
Fourth-quarter output rose 0.2%, supported by stronger consumer spending and investment, statistics agency Insee said. That marks a slowdown from the previous three months but matched the median estimate of analysts surveyed by Bloomberg.
The data precede numbers from the region’s other top economies, with Spain, Germany and Italy all expected to report expansion later Friday, before Eurostat publishes a reading for the euro zone as a whole. Economists estimate the bloc’s gross domestic product (GDP) rose 0.2% between October and December — slightly slower than in the previous three months.
The continent is holding up well after Donald Trump raised tariffs last year, though is on alert again over new levies following the US president’s latest trade threats over Greenland. It can, at least, breathe easy as regards inflation, which is settling around the European Central Bank’s target, keeping interest rates steady at 2%.
In France, the second half of 2025 was clouded by another government collapse and rows over tax hikes and spending cuts that are needed to rein in a gaping budget deficit.
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Consumer spending growth, however, accelerated to 0.3% — even as a separate report showed outlays declined on the month in December as households held back on manufactured goods and food.
Amid warnings from business groups that the crisis would spark a downturn, firms’ investment in the fourth quarter fell slightly. Household investment, however, rose 1.1%.
For 2025, GDP rose 0.9% — matching the pace the government was banking on in its budget plans.
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France’s political and fiscal outlook has also improved in recent days as Prime Minister Sebastien Lecornu advanced a compromise budget through Parliament. The finance bill contains less belt tightening and fewer tax increases than initially planned after the government made concessions to opposition parties.
Uploaded by Liza Shireen Koshy
