French households hit historic morale low amid inflation and retirement worries

INSEE data shows the confidence index of French households fell to 82 in May 2026, a drop of two points and the lowest level in three years. The decline is linked to persistent inflation, stagnant real wages and uncertainty about retirement prospects. Inflation in May was reported at 2.4%, only a slight rise from the previous month, and France remains among the EU nations with the lowest price growth, helped by limited reliance on hydrocarbon‑generated electricity.

Households are saving heavily – 17.9% of disposable income is set aside, with 9% directed to financial assets – a historically high rate that reflects caution despite moderate unemployment. At the same time, housing prices have surged, doubling since 2020 while incomes have risen by just 45%, pushing the cost of a home to nearly five years of average earnings and squeezing first‑time buyers. Energy costs have also risen, with a 60‑litre fuel tank becoming about €18 more expensive, adding further strain to household budgets.