France: Central Bank Governor sounds the alarm: ‘We’re being strangled by interest rates’
Moulin tells the FT: a budget must be approved that reduces spending and the deficit
If France does not adopt a budget plan capable of reducing spending and the deficit, it risks being “gradually strangled by rising interest rates”.
This is the warning issued by the new Governor of the Bank of France, Emanuelle Moulin, in an interview with *The Times*.
“France is not like Greece during the euro crisis,” he cautioned. “If it manages to pass a budget this year to reduce spending and the deficit – such as the one proposed by the government – the markets will be reassured by these concrete steps towards fiscal consolidation.”
However, “if we do not act, there is a risk that we will gradually be strangled by rising interest rates. We must remain in control of our own destiny,” he said.
Last week, yields on French 10-year bonds approached 5 per cent.
