CQS founder Michael Hintze has warned that a “loss of confidence in France would shift the eurozone’s troubles to a higher plane,” noting that political paralysis may hamper the French government’s ability to push through the “deeper economic reforms that are required” to bring the country out of recession.
More from The Telegraph:
“France lies not only at the core of the eurozone, but is also one of the original architects of the European Union. Clearly, a loss in confidence in France would likely have far-reaching consequences; its impact on the EU, the broader global economy and markets.”
France, which yesterday was shown to have plunged back into recession, represents 19.6pc of eurozone GDP and 14.4pc of European Union GDP. Its share of the European Central Bank’s capital is 14.2pc…
Mr Hintze said: “President Hollande’s ability to drive structural reform may be limited by his ability and willingness (and the Socialist Party’s support of him) to pursue the deeper economic reforms that are required – the tax and benefits system, deep reductions in government spending and public administration, and extensive reforms to pensions and the labour market.”