France's Economy Stalls! GDP Falls As Government Faces €43 Billion Budget Battle | Times Now World

France's economic troubles are deepening, with GDP shrinking by 0.1% in the third quarter of 2026. The latest setback puts Europe's second-largest economy under fresh pressure, as growth falters and fears of a debt-driven financial crisis intensify. Even France's own economy minister is warning that the country could hit a financial breaking point without urgent budget action. The latest contraction follows a 0.1% decline in the first quarter, while the second quarter recorded zero growth. Three consecutive quarters without meaningful expansion have exposed the depth of France's economic troubles. Economy and Finance Minister Roland Lescure blamed extreme summer heat and surging energy prices for the latest setback, warning that the economy urgently needs a restart. The government is pushing a massive $43 billion savings plan under its proposed 2027 budget, targeting a deficit reduction to 5% of GDP. Lescure has warned that failing to implement these adjustments could push France towards a financial breaking point. The budget is also seen as critical to restoring investor confidence and reviving growth in the final quarter. But the government's austerity push ...faces a parliamentary roadblock. France failed to pass budgets before the new year in both 2024 and 2025. With presidential elections approaching in spring 2027, political divisions could deepen. Prime Minister Sébastien Lecornu may have to bypass a parliamentary vote through a constitutional mechanism, risking no confidence motions against his minority government. France's 2026 deficit target of 5.4 percent is also in jeopardy. The government had based its calculations on projected growth of 0.5 percent, an increasingly difficult target amid repeated economic setbacks. With 43 billion dollars in savings at stake and markets awaiting fiscal clarity, Paris faces mounting pressure to prevent its economic troubles from escalating.