French Economy Facing Huge Challenges

France is stuck in a major rut.

Europe’s third biggest economy has suffered years of anemic growth, high unemployment and budget deficits, while neighbors such as Germany and the U.K. have enjoyed a stronger recovery from the global financial crisis.

The country’s economic malaise is a major issue in presidential elections.

Before voting began Sunday, the contest had narrowed to a four-way race between candidates from across the political spectrum. Two of them — far right politician Marine Le Pen and socialist Jean-Luc Melenchon proposed radical ideas on how to improve the economy. Both oppose free trade agreements and are highly critical of the euro.

Melenchon crashed out in Sunday’s vote but Le Pen came second and now faces centrist reformer Emmanuel Macron in the run-off. But will either of them have the right prescription to cure France?

After years of slow growth, the country’s GDP figures are finally turning higher. But they remain at very low levels.
The French economy expanded by 1.2% in 2016, according to the International Monetary Fund. The two larger economies in Europe — Germany and the U.K. — posted growth of 1.8% over the same period.

via CNN

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza