French Economy Grows 0.3% in Q2 Surpassing Forecasts

The French economy grew by 0.3% in the second quarter of 2025, surpassing analysts' expectations and improving upon the 0.1% growth seen in the first quarter. This growth was primarily driven by a rebound in household spending, which helped offset weak domestic demand and trade challenges. Despite this positive momentum, France continues to face sluggish overall economic growth and a significant budget deficit, currently at 5.4% of GDP. Prime Minister Francois Bayrou has set targets to reduce the deficit to 4.6% by 2026 and align with the EU's fiscal deficit limit of 3% by 2029. Finance Minister Eric Lombard highlighted the resilience of the economy amid external pressures such as the EU-U.S. trade tariffs. Analysts caution that future government spending plans may face challenges, especially with commitments to increased EU military expenditures.