The government deficit in the euro area stood at 3.3% of GDP in the second quarter of 2026, up slightly from 3.2% in the first quarter, Eurostat reported on 21 October 2026. In the wider European Union the seasonally adjusted figure was 3.5%, compared with 3.1% in the previous quarter. Both readings sit above the 3% reference value in the Stability and Growth Pact, although that threshold is formally assessed on annual data.

The mechanics are simple. Euro area government revenue rose by about €21 billion in the quarter, yet it slipped from 46.9% to 46.8% of GDP because nominal output grew faster. Expenditure rose by about €28 billion and edged up from 50.0% to 50.1% of GDP. That left the gap between spending and income at 3.3% for the currency bloc. Across the EU, revenue stood at 46.3% of GDP and expenditure at 49.8%.

Country data show a widening spread. Romania recorded the deepest government deficit at 9.2% of GDP, up from 5.5% in the first quarter. Hungary followed at 7.2%, then Poland at 5.9%, Belgium and Bulgaria at 5.3% each, and France at 5.1%. Germany reached 4.1%, up from 3.8%. By contrast, Cyprus, Denmark, Greece, Ireland and Portugal reported surpluses of 3.3%, 2.7%, 2.2%, 1.9% and 0.8% respectively.

Some quarterly swings are large. Lithuania’s government deficit moved from 0.8% to 3.2% of GDP, Estonia’s from 1.6% to 3.2%, and Latvia’s from 1.5% to 2.9%. Bulgaria moved the other way, narrowing from 7.9% to 5.3%. These figures are provisional and seasonally adjusted, so single-quarter jumps are best read as signals rather than verdicts.

The longer series adds context. Across the nine quarters since the second quarter of 2024, the euro area government deficit has ranged between 2.8% and 3.3%, and the latest reading is the highest of the run. The EU series reached 3.4% in an earlier quarter, which makes the new 3.5% the top of its range as well.

Why does this matter in Brussels? Commission economists will use the quarterly pattern as an early reading while member states finalise 2027 budgets under the reformed fiscal rules. Several of the countries at the top of the table, including France, Romania and Poland, have been in the excessive deficit procedure, so a deteriorating quarter adds pressure on credibility just as capitals promise consolidation.

The euro area government deficit of 3.3% looks modest next to the national extremes, yet the direction matters. With revenue failing to keep pace with output and spending still climbing, the government deficit enters the winter as a test of whether the consolidation promised in national plans will show up in the data. Eurostat’s next quarterly release, due on 22 January 2027, will show whether the second quarter was a blip or a trend.