The French state deficit in the ten months to October was EUR99.4bn, significantly below EUR133.1bn a year earlier. While year-on-year comparisons of fiscal data are prone to structural changes in the way revenues and expenditures are accounted for and, thus, difficult to compare, overall, it seems to us that the government will be able to achieve its full-year target of reducing the state deficit from EUR148.8bn to EUR95.3bn (revised down by c.EUR200mn last month).

Despite the existence of special factors in the first ten months of data, the state deficit to October is EUR33.7bn lower than at the same time last year. Provided the economy does not deteriorate further relative to what is embedded in the forecasts for the rest of Q4 and the government is ready to curb spending in the event of slippages (for instance through under execution of spending), the central deficit target should be met given the calendar effects occurring at the end of the year.


source: BarCap