French bond sell-off ‘reminiscent of the euro crisis’ as Paris proposes cuts and tax rises – business live
Rolling coverage of the latest economic and financial news France’s government did try to cool the situation yesterday, by proposing a budget for next year including €43bn in cuts and tax rises. Under the proposed plan, the tax burden would rise while spending growth would be slowed through slashing state spending, and capping increases to pensions and civil servant salaries. France’s fiscal…
France is facing a financial crisis reminiscent of the Euro crisis, as the country's government proposes a budget including €43 billion in cuts and tax rises. The plan aims to reduce the deficit, but it won't stabilize public debt. French bonds are expected to remain under pressure, with the European Central Bank's intervention threshold still high.
The economic turmoil began as businesses started the fourth quarter (Q4), with signs of financial stress affecting the entire region. The situation has many parallels to the Euro crisis, with sovereign contagion being a major concern. Key economic indicators released yesterday included the UN's Food Price Index, a Eurozone flash inflation reading for September, the US non-farm payrolls employment report, and the US factory orders report for August.
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