France: First overview of the 2019 budget – BNP Paribas

Sandeep Kanihama FXStreet Contributor

Hélène Baudchon, Research Analyst at BNP Paribas, explains that faced with slower than expected growth, the French government has raised its fiscal deficit forecasts for 2018 and 2019.

Key Quotes

“It is now looking for a deficit of 2.6% of GDP in 2018 and 2.8% in 2019 (up from 2.3% and 2.4%, respectively, in the April 2018 Stability programme).”

“The wider 2019 deficit can be attributed to the transformation of the CICE tax credit into reduced employers’ contributions, which has a fiscal cost of about 1 point of GDP.”

“It masks an improvement in the structural deficit, estimated at about 0.3 points, thanks to efforts to reduce spending.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

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