Global Economy Shows Resilience Amid Uncertainty; French Sectoral Trends Signal Mixed Outlook for Early 2026

The global economy is demonstrating surprising resilience in the face of ongoing trade and political uncertainties, with growth projected to stabilize around 2.6% in 2026 before a modest rise to 2.7% in 2027. This outlook, from the World Bank’s January 2026 Global Economic Prospects report, credits stronger-than-expected growth in the United States for about two-thirds of the upward revision in global forecasts. However, the 2020s remain on track to be the weakest decade of global growth since the 1960s, with income inequality widening as one in four developing economies remain poorer than in 2019 despite improvements in nearly all advanced economies.

In France, economic activity continued to expand in December 2025, albeit at a slower pace than the previous month, according to a survey of about 8,500 businesses by the Banque de France. The industrial sector benefited from robust growth primarily driven by aerospace and defense, while the services sector grew moderately, and construction activity remained stagnant. Industrial activity is expected to ease in January, with production pauses in aerospace and order uncertainties weighing on momentum. Services, conversely, anticipate stronger activity aligned with the decade’s average, and construction activity is expected to stay stable with better performance in finishing works.

Cash flow across French sectors is roughly balanced but conceals disparities, while recruitment difficulties persist in skilled trades and construction despite some stabilization. The monthly uncertainty indicator remains high despite a decrease, reflecting continued cautiousness in key sectors. Price trends show stability in industry, moderate increases in services, and declines in construction. The Banque de France estimates France’s GDP grew by at least 0.2% in the fourth quarter of 2025.

Globally, inflation is projected to ease slightly to 2.6% in 2026 amid lower energy prices and easing labor market pressures. Developing economies are forecast to slow growth to 4% in 2026 before rebounding slightly in 2027, though per capita income advances remain limited relative to advanced countries. The World Bank highlights the pressing need for investment liberalization, business environment improvements, and mobilization of private capital to sustain growth and address job creation challenges, especially with 1.2 billion young people entering the labor market over the next decade. Fiscal discipline through budgetary rules in developing countries is key to stabilizing public finances, which face growing pressures.

Inderjit Gill, Chief Economist at the World Bank, noted the paradox of eroding growth potential with increasing resilience to policy uncertainty, underscoring the fragility of public finances and credit markets. This nuanced global setting informs France’s mixed sectoral growth outlook as it navigates uncertainty while benefiting from strengths in aerospace and services.