planned cuts to medication reimbursements and reduce contributions to the European Union’s budget. The New Popular Front, meanwhile, wants to lift public spending and raise tax on super-profits and the wealthy.
As it stands, analysts think it’s likely that France’s major political blocs will agree a provisional budget, which simply rolls over the 2024 budget into next year. This will prevent any new year government “shutdown” where France is no longer able to meet its financial obligations.
Such a move would, however, delay the urgent need to tackle France’s fiscal problems, with the budget deficit already predicted to hit 6.1% of GDP in 2024, and is expected to rise further if measures are not taken to rein in spending.
Investors are currently looking cautiously toward France, with the yield on France’s benchmark 10 year government bond rising 3 basis points Friday morning, ahead of the announcement to around 2.99%. The French CAC 40, meanwhile, was up 0.5%.
— CNBC’s Holly Ellyatt contributed to this report.
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