French economy stagnates in Q2 with inflation at 2.7%

The final data indicate that the French economy recorded zero growth in the second quarter of 2026, falling short of the expected 0.2% growth. Despite the slowdown, exports increased significantly by 2.9%, driven by gains in the aviation sector. Household spending also rose by 0.3%, while consumer confidence remained stable. At the same time, the annual inflation rate rose to 2.7% in August, due to higher energy prices. This adds pressure to the French economy, which faces challenges from trade tensions, the Israeli-American conflict, and budget deficits, amidst plans to increase spending to bolster defense and artificial intelligence technologies.