Households finally recover to consume, GDP growth is better than expected at 0.3%

A certainly moderate increase, but better than early economists. According to the Insee figures presented this Wednesday, July 30, France’s economic growth reached 0.3% in the second quarter, driven by shares and a slight rebound in household consumption.

This moderate increase in the Gross Domestic Product (GDP) between April and June, in a very uncertain national and international context, is greater than the forecast of the National Statistics Institute, which anticipated a growth of 0.2% after +0.1% in the first quarter.

At the beginning of the year, it was the actions that led to growth with a positive contribution of 0.5 points, after +0.7 points in the first quarter. The actions represent the goods produced but are not yet sold at the end of a certain period, in the case of aeronautical and automotive equipment. An increase in actions may mean that an boom in early demand is made. Or, less favorably, that manufactured products did not find a policyholder.

Household consumption rebounds

However, external actions, the final domestic demand stagnated. A traditional growth pillar, household consumption has recovered slightly, 0.1% after a 0.3% decrease in the first quarter, driven by the highest consumption of food products.

However, households have also consumed more services, while mild temperatures weighed in energy consumption, which fell 2.4% (after +0.8%).

In June alone, household consumption also accelerated at +0.6% in June against 0.1% in May. This increase is markedly caused by energy spending, which increases again to +3.5% in June compared to May, as well as the consumption of manufactured goods that are slightly straightened to +0.5% in a month. On the contrary, food consumption fell back to -0.9%, specifies INSE.

Throughout the second quarter of 2025, the consumption of households in goods was recovered slightly, in 0.1%, after a 0.6% decrease in the first quarter of the year, specifies the insep.

Red investments

In April and June, the investments sank in red (-0.3% after -0.1%), penalized in particular by construction.

In an environment marked by the commercial war initiated by the United States in April, the contribution of foreign trade to growth has remained negative, -0.2 points after -0.5 points, the light rebound in exports has been counteracted by an acceleration of imports.