According to Eurostat, the euro area experienced a growth rate of 0.4% in the third quarter of 2026, a decrease from 0.6% in the previous quarter, which had followed a period of stagnation. This growth figure surpassed the 0.2% that economists had predicted in a Reuters poll. However, France's economy faced a setback, contracting by 0.1% during the same period.
This decline is attributed to high borrowing costs and a political struggle to manage the country's significant deficit, compounded by public unrest over living costs. The European Central Bank (ECB) decided to maintain interest rates, citing that the impact of rising energy prices had not yet led to broader economic repercussions.
Nevertheless, analysts suggest that the ECB may consider another rate hike in December due to persistent high energy costs and increasing downside risks to growth