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# [LA RÉUNION] IEDOM Q2 2026 outlook: fuel shock stalls recovery, unemployment ticks back up
- URL: https://businessoi.media/en/la-reunion-conjoncture-iedom-t2-2026-le-choc-carburant-freine-la-reprise-le-chomage-repart-en/
- Published: 2026-10-17T13:41:09.000Z
- Updated: 2026-10-17T13:41:09.000Z
- Description: ICA at 100.1 (-3.6 pts) per IEDOM. Fuel +22.2% year on year, inflation at 1.5%, unemployment rises (+1.6%) after 3 quarters of decline. Services and tourism hold up.
- Author: Emmanuel TAOCHY
- Tags: La Réunion, Économie, emploi, Clôture, #en

**Réunion enters the second half of 2026 with a fragile recovery. According to the latest IEDOM business survey, the spring oil shock pushed fuel prices up 22.2% year on year, lifted inflation to 1.5% and reversed the labour market trend after three consecutive quarters of falling unemployment.**

## Business climate indicator stalls

Réunion's **business climate indicator (ICA)** fell **3.6 points** in the second quarter of 2026 to reach **100.1**, its long-term average. This deterioration confirms that the recovery that began in late 2025 is losing steam under the combined pressure of Middle East geopolitical tensions and rising energy prices.

Fuel prices surged **+22.2%** year on year from April 2026 onwards, pushing inflation to **+1.5%** in June from zero at end-March. Most businesses report raising their selling prices, and mobility is contracting.

## Labour market reverses course

After three consecutive quarters of decline, the number of **jobseekers in categories A, B and C** rose **+1.6%** in the second quarter. Category A (unemployed and immediately available) was up **+1.4%** — an inflection that signals a weakening of the island's labour market, consistent with the national trend.

## Retail trade clearly under pressure

Réunion's retailers reported a « sharp deterioration » in Q2, with falling footfall and a negative outlook for the following quarter. **Banknote deposits at IEDOM** fell **\-2.5%** year on year — a proxy for cash transactions that points to more cautious consumer spending.

One positive note in the retail sector: **new car registrations** rose **+1.2%** year on year, after a weak first quarter.

## Services and tourism buck the trend

Services stand out as a bright spot. The sector is proving resilient, with a higher share of firms reporting no impact from the crisis compared to other industries. **Air traffic** grew **+1.3%** quarter on quarter in seasonally adjusted terms, confirming the strength of air connectivity and inbound tourism.

## Why it matters

Réunion is fully exposed to the double effect of being an island economy heavily dependent on imports and an ongoing global energy shock. The uptick in unemployment after three quarters of decline is the most worrying signal: it indicates that businesses are absorbing the shock by curbing hiring. For local policymakers, this calls for a coordinated response combining consumer purchasing power support, SME assistance and energy diversification — the island has set a target of 100% renewable electricity by 2030.