The Specter of a French Euro Exit Rises

27.02.2017 • The Economy

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The figure for an exit of the euro according to the Institut Montaigne Marine Le Pen climbs the polls.

The Montaigne Institute figures the effects of an exit from the euro as proposed by the National Front: “France’s GDP would decline by 2.3% during the first year of the return to the franc and would be less than 9 % In the long term (…) a loss of activity of € 180 bn “.

The institute – including Les Echos commented on the study – assumes a 20% exchange rate depreciation and an increase in interest rates.

With a GDP of 2,232 billion euros at the end of 2016, growth prospects almost zero and the inevitable degradation of the French rating that a “Frexit” would entail, the weight of our debt will be even more unsustainable; We will then join the countries of the periphery for good.

French investors would ultimately be the hardest hit.

However, for the moment, they do not seem to worry and do not hesitate to water their booklet A, thus financing social housing: “The success of Livret A for this beginning of 2017”, reads in Le Revenu : “deposits exceeded the withdrawals in the amount of 2.89 billion euros in January”. The Sustainable Development Booklet represents a net inflow of € 380 million in the same month.

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