STOCK MARKET WATCH -- Wednesday, 8 February 2012

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44. French budget deficit falls

http://www.irishtimes.com/newspaper/breaking/2012/0208/breaking21.html

France's central government slashed its budget deficit last year by a third thanks to the end of one-off spending measures, the budget ministry said today, but state auditors said much tougher austerity measures were needed to hit EU targets.

The central government's 2011 shortfall came in at €90.8 billion, €4.5 billion better than forecast in last year's budget, meaning France should comfortably beat its overall state deficit target for last year of 5.7 per cent of GDP.

President Nicolas Sarkozy said recently the overall public deficit - which includes social security and local authority spending - could have dipped as low as 5.3 per cent of gross domestic product last year, putting France well on track to meet this year's target of 4.5 per cent.

Today's figures showed that, while revenues were flat last year, the central government was able to slash its deficit as spending tumbled by 14 per cent to €365.4 billion.