FRANCE DATA: Q3 GDP Confirms Flash At 0.5% Q/Q, Domestic Demand Softer

France Q3 final GDP confirmed flash estimates at 0.5% Q/Q for an acceleration from 0.3% in Q2, along with 0.9% Y/Y after a downward revised 0.7% (-0.1pp) in Q2. GDP growth has been picking up pace throughout 2025 after US-driven trade disruption in Q1, with this quarterly rate being the highest since Q2 2023. Final domestic demand continued to lag, however. 

• Gross fixed capital formation grew 0.5% in Q3, after a flat print in Q2, "driven by the acceleration of GFCF in information and communications".
• Household consumption saw another slight increase of 0.1% (vs 0.1% Q2). "The decline in spending on food products (-1.0% vs 1.5% Q2) is more than offset by the rebound in spending on energy (1.3% vs -2.3% Q2) and by the increase in spending on services (0.1% vs 0.5% Q2)", notes INSEE.
• Inventories switched to a sizeable drag in Q3 of -0.35pps after tariff front-running saw a strong build worth an average 0.6pps through 1H25.
• For a better sense of underlying activity, final domestic demand increased 0.3% Q/Q in Q3 after 0.2% in Q2 and -0.1% in Q1, for its fastest pace since 3Q24. Final domestic demand held steady at 0.5% Y/Y meanwhile, where it's been for five of the past six quarters.
• Looking more broadly, comparing Q/Q growth rates, 2025 is broadly in line with last year, averaging 0.3% so far this year vs 0.2% 2024. The same comparison for Y/Y rates shows 2025 slightly weaker (averaging 0.8% vs 1.1% 2024), however a weak print in Q4 last year could point to a higher Y/Y rate in the next reading.