Protesters march through central Paris amid fire, smoke, police presence and clashes during nationwide demonstrations against the soaring cost of living in Paris, France, October 17, 2026.
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Anger over the cost of living and pressures on public services has brought hundreds of thousands of protesters to the streets in several European countries, with complaints ranging from expensive housing to poor conditions at schools and universities.
The largest demonstrations occurred in France over the weekend, with more than 500,000 people marching. Although the majority of protests were peaceful, some committed looting, destroying stores, setting fire to city hall, and attacking police officers.
Separate protests were held in Italy, Spain, Portugal and Albania on Saturday and Sunday. High fuel and energy costs formed part of the backdrop in some countries, but their immediate triggers were different. The wars in Iran and Ukraine have caused diesel prices to rise sharply across the continent.
Andrew Kenningham, chief European economist at Capital Economics, told CNBC there was no “single trigger” for the riots. Rising energy costs may be a contributing factor, he added, but the increase is smaller than in 2022 at the outbreak of the Russia-Ukraine war, when there were no comparable violent protests.
Nevertheless, the demonstrations present a common challenge to governments. It is about how to improve living conditions and maintain public services while supporting household budgets and curbing fiscal stress.
What sparked the protests?
Demonstrations in France began last month after high school students criticized poor educational conditions, including poor equipment and a lack of teachers. They subsequently evolved into widespread protests over declining living standards and public services.
In Spain, housing protests began in September after 87-year-old Maricarmen Abascal was evicted after an investment fund raised her rent by 230%. She died two weeks later.
Thousands of demonstrators also took to the streets in Portugal on Saturday to protest against rising housing and living costs.
Portugal’s Minister of State and Finance Miranda Sarmento said on Monday: “It’s clear that people are protesting against the cost of living with the price of diesel and fuel, but mainly against the cost of housing. Housing costs have increased significantly across Europe, and especially in Portugal.”
In Albania, demonstrators, angered by poor university conditions and high tuition fees, called for Prime Minister Edi Rama to resign. Some threw Molotov cocktails and other objects at police and set cars and trash cans on fire.
In Italy, a demonstration over living expenses in central Milan on Saturday ended in violence, with rioters attacking police with stones and paving blocks and setting barricades on fire.
“The fundamental problem is that politicians are unable to offer many Europeans the hope of a better life, because economic growth is slow and governments have racked up huge debts, leaving little room to support more public spending or cut taxes,” said Kenningham of Capital Economics.
Why now?
Douglas Yates, a professor at the American Graduate School in Paris, said the escalation in violence, particularly in France, was due to a “combination of factors.”
“This was a storm that turned into a hurricane,” Yates told CNBC’s Steve Sedgwick. “Because there was inflation, it aroused cost-of-living demonstrators who would have been dissatisfied anyway.”
Yates said another factor is the 2027 French presidential election, where opposition parties are looking to capitalize on growing public dissatisfaction with President Emmanuel Macron.
Prime Minister Sébastien Lecornu has proposed a 2027 budget aimed at reducing France’s deficit, which is projected to be 5.4% of gross domestic product this year. Measures include freezing the civil servant salary index and strengthening sick leave compensation.
“Finally, there are the students. Poor students started this problem by making reasonable demands to have their dilapidated infrastructure repaired and perhaps to have air conditioning installed in their classrooms. And these three forces combined to create an out-of-control hurricane,” Yates added.
The economic situation is also deteriorating. According to the national statistics office Ince, France’s unemployment rate rose to 8.3% in the second quarter of 2026, equivalent to 2.7 million people. The unemployment rate for 15-24 year olds rose to 21.6%.
Consumer prices rose 3.1% in September from a year earlier, up from a 2.4% rise in August, according to final data from Insee. Energy prices rose 21.3%. Meanwhile, purchasing power per unit of consumption is expected to decline by 0.7% in 2026, according to Ince statistics cited by Le Monde.
The French Institute for Economic Research (Le Monde) calculates that the decline in purchasing power from 2024 onwards will be equivalent to a loss of 1,200 euros ($1,345) per year for a household of two adults and two children, and 600 euros for a single adult.
October 17, 2026: Protesters on October 17 in Limoges set fire to the town hall of Limoges-Haute-Vienne in France’s Nouvelle-Aquitaine region.
Elise Cabane | AFP | Getty Images
Portuguese Prime Minister Sarmento said the situation across Europe was mixed, with Portugal in good financial shape and far less debt than France.
“These countries (with increasing public debt) have much less fiscal space to act, but the key issue is that productivity and competitiveness issues need to be resolved at European level,” he said.
Sarmento added: “Europe’s economy is not growing as much as the US. Without economic growth, it is impossible to get better salaries and finance better public services and social support.”
According to Eurostat, in the second quarter of 2026, Portugal recorded the highest annual house price growth in the EU, rising 16.5% year-on-year.
To solve this problem, the Portuguese government is considering increasing the supply of housing to reduce the cost of buying and renting housing, Sarmento said.
French fiscal pressure
French bond yields rose and the euro fell on Monday as unrest heightened investor concerns about France’s debt and budget.
“It’s going to be difficult to see the deficit come down without painful policies,” Sharon Bell, senior European equity strategist at Goldman Sachs, told CNBC’s “Squawk Box Europe” on Monday.
“There is a good chance that taxes will go up for companies in France. I think there is a chance that taxes will go up in general in France. Fiscal consolidation means you have to either reduce spending or increase taxes. These things are very difficult.”
Mike Bell, head of market strategy at RBC BlueBay Asset Management, said France faced a “very real risk” of a sovereign debt crisis.
“What we need in France is to get our finances in order. We need to raise the retirement age – if the average person lives to 84, you can’t retire at 62 – but if this is happening before we even start talking about it, imagine what would happen on the streets of France if we tried to raise the retirement age…I mean here in the UK it’s 68,” Bell added.
