The French economic outlook is deteriorating further. The government is now forecasting only 0,5% growth in 2026, half the initial projection in the budget law, while the deficit will ultimately exceed 5%. Appearing on TF1 Friday morning, Maud Bregeon defended the government, citing an accumulation of "successive crises."
“We are going through successive crises: the closure of the Strait of Hormuz, the heatwave, the drought,” explained the government spokesperson. The war in the Middle East and rising energy prices have weighed heavily on economic activity, while the summer weather events have also slowed down certain sectors.
A few hours later, Economy Minister Roland Lescure officially announced expected growth of only 0,5% in 2026. The government had still been forecasting 1% in the budget. For 2027, the Ministry of Finance hopes for a rebound to 1%. Inflation, meanwhile, is expected to reach 2,1% this year, with a possible peak of 3% at the end of the year.
"French spending will be kept to a minimum."
Despite this deterioration, Maud Bregeon insists that the government will not change its budgetary approach. "Our objective is to control spending," she emphasized. "We cannot control the external factors, but French spending will be kept under control."
The bad news continues to pile up for the government: INSEE (the French National Institute of Statistics and Economic Studies) is even more pessimistic, forecasting only 0,4% growth this year. Roland Lescure also acknowledged that the objective of limiting the deficit to 5% by 2026 was no longer "an option." Just months before the presidential election, the government will therefore have to draft its final budget with less growth, higher inflation, and even more deteriorated public finances.
