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France sees 2014 budget gap lower than initial target

Xinhua, March 5, 2015 Adjust font size:

French Finance Minister Michel Sapin on Wednesday expected 2014 budget gap lower than an initial forecast of 4.4 percent, boosting Paris' chances to respect EU fiscal rules and to reach the safe line mandates by its European partners.

"We will largely respect the target of 4.4 percent, that is to say, that it will be below (it)," Sapin told the Senate's Finance Committee.

Sapin estimated also a zero inflation this year, previously estimated 0.9 percent, rising risks of a deflation in the eurozone's second largest economy where households consumption is its main growth engine.

Having been blamed of failing to promote growth, bring down wide budget gap and trim record high joblessness rate, French President Francois Hollande promised to put the country's finances in order by squeezing public spending and improving competitiveness to reach a deficit of 4.1 percent this year

He postponed by two years to 2017 a reduction of its budget deficit to below 3 percent of France's GDP, the rate mandated by the EU to have healthy finances. Endit