2026.01.3007:13:17UTC+00France Q4 GDP Growth Hits 3-Quarter Low

France's economy witnessed a modest expansion of 0.2% quarter-on-quarter in the fourth quarter of 2025, a deceleration from the 0.5% growth observed in the third quarter, aligning with market forecasts, according to preliminary data. This represents the most modest quarterly growth in the last three quarters, primarily due to a reduced contribution from domestic demand. Growth in government expenditure decelerated to 0.3% from the previous quarter's 0.7%, and fixed investment also slowed down to 0.2% from 0.7%. This investment slowdown was attributed to reduced spending on transport equipment, capital goods, and construction. Changes in inventory continued to impede growth, detracting 1.0 percentage points. Conversely, household consumption demonstrated a faster pace, growing by 0.3% compared to the previous 0.1%, driven by increased expenditure on goods and a continued rise in services consumption. Net trade significantly contributed to growth, adding 0.9 percentage points, as exports maintained growth at 0.9%, despite a previous higher rate of 3.2%, while imports decreased by 1.7% following a previous increase of 1.5%. On a year-on-year basis, GDP saw a 1.1% growth, up from 0.9% in the third quarter, although slightly below the anticipated 1.2%. Nevertheless, this marked the strongest annual expansion in five quarters.