• France’s fiscal shortfall and revisions illustrate the continuing challenges facing the euro area
  • Rigidities in product markets and costly regulatory requirements for firms also put downward pressure on France’s growth prospects

Moody’s casting their judgment on the fact that France is gearing up for another miss of the deficit target

Last Wednesday the head of France’s ruling party said that it would be unavoidable that France would miss the 3.8% target and this was confirmed by finance minister Michel Sapin a day later who said the deficit would top 4.0%. He also took a hatchet to growth forecasts cutting 2014 GDP to 0.5% from 1.0% and said that he doesn’t see growth much above 1.0% vs the 1.7% prior estimate.