Cyber Monday Deal: Up to 60% off InvestingProCLAIM SALE

France to miss 2017 deficit goal, jobless rate to dip slowly

Published 22/04/2015, 14:31
© Reuters. Businessmen are seen on the esplanade of La Defense, in the financial and business district in La Defense, west of Paris

By Brian Love

PARIS (Reuters) - France's economy is pulling out of the doldrums but not quickly enough to meet its European deficit-reduction commitments or claim significant progress in the battle to cut unemployment by 2017, an election year, a Reuters poll shows.

After growth of just 0.4 percent last year, gross domestic product is set to expand 1.0 percent in 2015, 1.4 percent in 2016 and 1.6 percent in 2017, according to the median forecast in the poll of 34 economists, conducted from April 16-21.

While slightly more upbeat than a January Reuters poll, the view of independent economists is that the government will continue its track record of failing to cut the public deficit as much as promised, even after multiple grace periods agreed with its euro zone partners.

The fiscal gap, which Paris promises will shrink to 2.7 percent of GDP in 2017, is forecast in the Reuters poll to fall by less, to 3.1 percent in that year - still topping the 3.0 percent that EU authorities consider the maximum manageable level.

The Reuters poll showed economists are nonetheless more optimistic about progress more generally on deficit reduction than they were in January. Median forecasts were for a deficit of 3.8 percent of GDP this year and 3.4 in 2016 following a better than expected dent in the deficit in 2014.

The unemployment rate, ultra-sensitive for Socialist President Francois Hollande after he failed to honour promises to secure a fall by the end of 2013, is forecast to decline only very slowly, from 10.3 percent in 2014 to 10.2 percent this year, 10.1 percent in 2016, and then to 9.8 percent in 2017.

Hollande has suggested he will not even consider seeking a second term if he fails to impress on the jobs front.

© Reuters. Businessmen are seen on the esplanade of La Defense, in the financial and business district in La Defense, west of Paris

It is not clear for now if he will have convincing results to show voters by the time any re-election campaign would start, prior to a ballot scheduled for May 2017.

(Reporting and polling by Brian Love, Additional polling by Sarmista Sen; editing by John Stonestreet)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.