Eurozone GDP beats forecasts at 1.3% in Q3 as Portugal grows 2.4% and France shrinks 0.1%

Eurozone growth beats expectations

Eurostat's preliminary estimate put eurozone GDP up 1.3% year on year in the third quarter of 2026, above the 1.1% expected by markets and faster than the 1.2% recorded in the second quarter. The European Union as a whole grew 1.5% year on year, up from 1.4%. Quarter on quarter, the eurozone expanded 0.4% and the EU 0.5%, after gains of 0.6% and 0.7% between April and June. Of the member states with data, 14 posted positive year-on-year growth and one recorded a decline. Eurostat warned that the estimates rest on incomplete sources and may be revised.

Eurozone1.3%

Portugal2.4%

Spain2.7%

Ireland3.6%

Eurozone

1.3 %

Portugal

2.4 %

Spain

2.7 %

Ireland

3.6 %

Data from the article text

Portugal slows but stays near the top

Portugal's GDP rose 2.4% year on year in the third quarter, below the 2.6% of the previous quarter, according to the flash estimate from Statistics Portugal (INE). Quarter on quarter, output increased 0.2%, down from 0.9% in the second quarter. INE said the slowdown came from weaker household consumption and a sharper fall in exports, while investment grew again as the Recovery and Resilience Plan (PRR) nears its end. Net external demand made a slightly negative contribution to quarterly growth.

“The gross domestic product, in volume, recorded a year-on-year change of 2.4% in the third quarter of 2026, after growth of 2.6% in the previous quarter.”

Q2 2026

0.9 %

Q3 2026

0.2 %

Data from the article text

Forecasts and government outlook

Before the release, the CIP and ISEG barometer had projected quarter-on-quarter growth of 0.3% and year-on-year growth of 2.5%. The Fórum para a Competitividade had estimated quarterly growth between 0.3% and 0.5%, and annual growth between 2.2% and 2.4%. The Católica Lisbon Forecasting Lab (NECEP) had expected stagnation in the quarter and year-on-year growth of 2.2%. The government expects the economy to grow 2.3% in 2026 and 2.1% in 2027, according to the draft State Budget for 2027. The Banco de Portugal forecasts 2.3% for 2026, and the Public Finance Council (CFP) 2.2%. The government attributes its more optimistic view to expected gains in private consumption and exports.

France and the rest of the bloc

France was the only large eurozone economy to contract, with GDP down 0.1% quarter on quarter in the third quarter after stagnating in the second quarter and falling 0.2% in the first, according to INSEE. Investment fell again by 0.6%, and the deterioration in external trade also weighed on the figure. Lithuania also declined, by 1.0% quarter on quarter. Ireland led the quarterly ranking with 5.5% growth, followed by Estonia, Spain and the Netherlands at 0.6% each. Ireland's year-on-year figure of 3.6% is calculated differently from other countries, and Spain posted 2.7%.

INSEE's provisional data also show French inflation rising to 3.4% in October, its highest since December 2023, with energy prices up 24.1% year on year against 21.3% in September. Services inflation reached 2.7% and food inflation eased to 1.2%. Harmonised inflation, used for European comparisons, rose to 3.8%.